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Notes to Accounts of Ador Welding Ltd.

Mar 31, 2022

(a) Includes:

(i) Rs. 0.01 lakh (31 March 2021: Rs. 0.01 lakh) being the aggregate value of shares in Co-operative housing societies.

(ii) Rs. 4 lakhs (31 March 2021: Rs. 4 lakhs) for tenements in an association of apartment owners.

(b) During the financial year 2021-22, a flat at silvassa is classified from "Property, plant and equipment" (Gross carrying amount Rs. 9 lakhs and Accumulated depreciation of Rs. 2 lakhs till 31 March 2022) is classified as "Asset held for sale".

(c) During the year the company has sold Narayana property situated at Delhi having gross block of Rs. 153 lakhs and accumulated depreciation of Rs 25 lakhs under "Property, Plant and Equipment", Rs 55 lakh shown under the head " Investment Property" and Rs 22 lakh shown under "Right of use of assets" for a consideration of Rs. 900 lakhs.

(d) During the previous year, the Company had entered into a Memorandum of Understanding for the sale/transfer of its right in Ahmednagar property admeasuring 66,108 square meters. Gross carrying amount (Land Rs. 1 lakh and building Rs. 406 lakhs) and Accumulated depreciation on building of Rs. 301 lakhs has been classified from "Property, plant and equipment" to âAsset classified as held for sale".

(e) The Company has pledged certain assets against borrowing limits (refer note 57 for details).

(a) The Company incurred Rs. 220 lakhs in the year ended 31 March 2022 (31 March 2021: Rs. 10 lakhs) towards expenses relating to short-term leases and leases of low-value assets. The total cash outflow for leases is Rs. 250 lakhs for the year ended 31 March 2022 (31 March 2021: Rs. 31 lakhs), including cash outflow of shortterm leases and leases of low-value assets. Interest on lease liabilities is Rs. 13 lakhs for the year 31 March 2022 (31 March 2021: Rs. 11 lakhs). [Refer note 40 and note 47]

(b) During the year the Company has sold Narayana property at Delhi having gross block of Rs. 153 lakhs and accumulated depreciation of Rs 25 lakhs under "Property, Plant and Equipment", Rs 55 lakh shown under the head " Investment Property" and Rs 15 lakh shown under "Right of use of assets" for a consideration of Rs. 900 lakhs.

*Estimation of fair value

During the year, valuations of the Investment properties is performed by a registered valuer as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017. During the previous year, valuations of the Investment properties is performed by a independent valuer and not by registered valuer as defined under rule 2 of Companies (Registered Valuers and Valuation) Rules, 2017. The fair value measurement is based on comparable sales approach (Previous year : rental yield approach). The fair value measurement is categorised in level 3 of fair value hierarchy.

The fair valuation is based on current prices in the active market of similar properties. The main inputs used for valuation are quantum, area, location, demand, quality of construction, age of building and trend of fair market etc.

(c) The Company has no restrictions on the reliability of its investment property and no contractual obligations to purchase, construct or develop investment property or for repairs, maintenance and enhancements.

(d) During the year the company has sold Narayana property at Delhi having gross block of Rs. 153 lakhs and accumulated depreciation of Rs 25 lakhs under "Property, Plant and Equipment", Rs 55 lakh shown under the head " Investment Property" and Rs 22 lakh shown under "Right of use of assets" for a consideration of Rs. 900 lakhs.

Inventory write downs are accounted, considering the nature of inventory, ageing, and net realisable value. Write-downs of inventories to net realisable value amounted to Rs. 38 lakhs (31 March 2021: 100 lakhs). These write down were recognised as an expense during the year and included in the ''Changes in inventories of finished goods, work-in-progress, and stock-in-trade'' in the Statement of Profit and Loss.

* Certain imported inventory amounting to Rs. 336 lakhs, which has been detained by the Bureau of Indian Standards (BIS), while the Company''s application for License was pending BIS approval, as BIS is alleging that the said imported inventory doesn''t meet the standards as specified in the notification issued by BIS. The matter is still pending before BIS and Company is awaiting for the outcome of the same.

(a) During the Current year, the Company has sold/transfered its right in Ahmednagar property admeasuring 66,108 square meters, as is where basis, for a consideration of Rs. 1,462 lakhs which has been duly approved by Board.

(b) During the Current year, the Company has entered into an agreement for the sale of one flat at Silvassa , for a consideration of Rs. 20 lakhs which has been duly approved by Board. The Company has received Rs. 14 lakhs as advance against the transactions. The transactions is likely to be completed in FY 2022-23 hence same has been classified as ''Assets classified as held for sale''.

Note 23 b- Rights, preferences and restrictions

The Company has only one class of shares referred to as equity shares having a par (face) value of Rs. 10 per share. Each and every 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 the remaining assets of the Company, after distribution of all the preferential amounts, in proportion to their shareholding.

(i) Nature of Security and terms of repayment for short term secured borrowings of Company:

Working capital loan from a bank, balance outstanding amount as at 31 March 2022 is Rs. Nil (31 March 2021: Rs 2,800 lakhs) is secured first pari passu charge by way of hypothecation of Company''s entire stocks and book debts, both present and future, exclusive charge on the entire plant and machinery and other movable fixed assets of the Company and on the land and building of the Company located at survey no. 59/11/1,59/11/2, 59/11/3, 59/12 and 59/13 situated at village Masat, Silvassa Dadra and Nagar Haveli. Working capital loan repayable on demand, Rate of interest 7% p.a. (31 March 2021: 7.20% p.a.)

(ii) Guarantees given by banks to third parties amounting to Rs. 2,657 lakhs (31 March 2021: Rs. 2,202 lakhs) on behalf of the Company are secured against securities mentioned in (i) above.

Note 44 - Contingent Liabilities not provided for :		(Rs. in lakhs)
Particulars	Year ended 31 March 2022	Year ended 31 March 2021
(a) Disputed sales tax as the matters are in appeal (advance paid 31 March 2022: Rs 105 lakhs; 31 March 2021: Rs 392 lakhs)	1,376	1,199
(b) Disputed excise duties as the matters are in appeal (advance paid 31 March 2022: Rs 900 lakhs; 31 March 2021: Rs 900 lakhs)	922	922
(c) Disputed income tax as the matters are in appeal (advance paid 31 March 2022: Rs 13 lakhs; 31 March 2021: Rs. 13 lakhs)	63	63
(d) Custom Duty refund (advance paid 31 March 2022: Rs 46 lakhs; 31 March 2021: Rs. 46 lakhs)	46	46
(e) Bank guarantees	2,657	2,202
(f) Other matters	98	111
g) Provident fund Based on the Honorable Supreme Court judgment dated 28 February 2019, relating to components of salary structure that needs to be taken into account while computing the contribution to provident fund under the Employee Provident Fund Act. Past provident fund liability is not determinable at present in view of uncertainty on the applicability of the judgment to the Company with respect to timing and the components of its compensation structure. In absence of further clarification, the Company has been advised to await further developments in this matter to reasonably assess the implications on its financial statements, if any.	Amount not determinable	Amount not determinable
(h) Inventory Certain imported inventory amounting to Rs. 336 lakhs, which has been detained by the Bureau of Indian Standards (BIS), while Company''s application for License was pending BIS approval, as BIS is alleging that the said imported inventory doesn''t meet the standards as specified in the notification issued by BIS. The matter is still pending before BIS and Company is awaiting for the outcome of the same.	Amount not determinable

Future cash outflows in respect of above matters are determinable only on receipt of judgments/decisions pending at various forums/authorities. The management does not expect these claims to succeed and accordingly, no provision for the contingent liability has been recognised in the financial statements.

a) The Bank returns were prepared and filed before the completion of all financial statements closure activities including Ind AS related adjustments / reclassifications, as applicable, which led to these differences between the final books of accounts and the bank returns which were based on provisional books of accounts.

b) Difference is due to restatement as entry was passed in the month of April 21 during closing of Mar 21.

c) Figures reported to bank were before considering provision of Rs.400 lakhs (Penalty for delay in office site Mobilization & Non Maintance of adequate Manpower).

d) Figures reported to bank were before considering provision of Rs.1,400 lakhs of receivable from Binyam International Company for General Trading & Contracting WLL.

The Group recognized right-of-use assets and lease liabilities amounting to Rs. 400 lakhs (31 March 2021: Rs. 11 lakhs) and Rs. 43 lakhs (31 March 2021: Rs. 11 lakhs) respectively. During the year ended, the Company had recognized interest expense on lease amounting to Rs. 13 lakhs (31 March 2021: Rs. 11 lakhs) and depreciation on right-of-use assets amounting to Rs. 26 lakhs (31 March 2021: Rs. 16 lakhs).

a. The aggregate depreciation expense on Right-of-use assetss is included under ""Depreciation and amortization expense"" in the statement of Profit and Loss.

b. During the current year 2021-22 in Right-of-use assets and lease liabilities, there is addition of Rs 43 lakhs towards laptops taken on rental basis.

c. The accrued finance cost on lease liabilities is included under "Finance cost" in the statement of Profit and Loss.

Lease payments not recognised as a liability

The Company has opted not to recognise a lease liability for short term leases (leases of expected term of 12 months or less). The Company has taken short term leases with a lease term of 12 months or less and the aggregate amount of operating lease rent debited to statement of profit and loss during the year is Rs. 220 lakhs (31 March 2021: Rs 10 lakhs). [Refer note 41]

Note 49- In the current year, Company operations are at normalcy and there is no impact of pandemic on the Company''s financials for the year ended 31 March 2022. However, the Management is continuously monitoring the current COVID-19 developments and possible effects that may result from the current pandemic on it''s financial conditions, liquidity, operations and actively working to minimise the impact of this unprecedented situation.

Note 50 - Employee benefits

As per Indian Accounting Standard-19 ''Employee Benefits'', the disclosure of Employee benefits as defined in the Standard are given below:

Brief description of the plans:

The Company has various schemes for employee benefits such as provident fund, superannuation and gratuity. In case of funded schemes, the funds are administered through trustees/ appropriate authorities. The Company''s defined contribution plans are superannuation, employees state insurance and provident fund as the Company has no further obligation beyond making the contributions. The Company''s defined benefit plans consists of gratuity only. The employees of the Company are entitled to compensated absences as per the Company''s policy.

I. Defined Contribution Plan:

(i) Superannuation fund

(ii) Provident fund

(iii) Employees State Insurance fund

During the year, the Company has recognised the following amounts in the Statement of profit and loss*:

(viii) Sensitivity Analysis:

Gratuity is a lump sum plan and the cost of providing these benefits is typically less sensitive to small changes in demographic assumptions. The key actuarial assumptions to which the benefit obligation results are particularly sensitive to discount rate and future salary escalation rate. The following table summarizes the impact in percentage terms on the reported defined benefit obligation at the end of the reporting period arising on account of an increase or decrease in the reported assumption by 50 basis points.

These sensitivities have been calculated to show the movement in defined benefit obligation in isolation and assuming there are no other changes in market conditions at the accounting date. There have been no changes from the previous periods in the methods and assumptions used in preparing the sensitivity analyses.

1. The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors.

III. Compensated absences

(i) An amount of Rs. 73 lakhs (31 March 2021: Rs 15 lakhs) has been recognised as an expense in the statement of profit and loss account and included in "Salaries, wages and bonus" under Note 39 "Employee benefits expenses".

Risk Exposure - Asset Volatility

The plan is of a final salary defined benefit in nature which is sponsored by the Company and hence it underwrites all the risks pertaining to the plan. In particular, there is a risk for the Company that any adverse salary growth or demographic experience or inadequate returns on underlying plan assets can result in an increase in cost of providing these benefits to employees in future. Since the benefits are lump sum in nature the plan is not subject to any longevity risks.

1. Mr. S. M. Bhat (DIN:05168265) had resigned from the office of / position of the Managing Director/ Employee/ Director of the Company with effect from 7 September 2020. The Board of Directors accepted his resignation with immediate effect and relieved him from his duties as the Managing Director.

2. Mr. Aditya T. Malkani (DIN:01585637) has been appointed as the Managing Director of the Company with effect from 14 September 2020 for a period of three (3) years by the Board of Directors of the Company.

3. Mr. Girish Anant Patkar had resigned from the office of / position of the Chief Financial Officer & Key Managerial Personnel of the Company with effect from 9 September 2020.

4. Mr. Surya kant Sethia was appointed as Chief Financial Officer & Key Managerial Personnel of the Company with effect from 8 February 2021.

5. All the above transactions with related parties are net of Goods and Service Tax.

Note 52 - Segment reporting

The Company''s chief operating decision maker (CODM) examines the Company''s performance and has

identified three reportable segments of its business instead of two segment as reported earlier:

(i) Consumables

(ii) Equipment and automation

(iii) Flares & Process Equipment Division*

The above operating segments have been identified considering:

(i) The internal financial reporting systems

(ii) The nature of the products/ process

(iii) The organisation structure as well as differential risks and returns of these segments.

Revenue and expenses have been accounted on the basis of their relationship to the operating activities of the segment. Expenses, which related to the Company as a whole and are not allocable to segments on a reasonable basis, have been included under "unallocable Income" and "unallocable Expenses" respectively. Assets and Liabilities, which related to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocable Assets / Liabilities". Inter-segment transfers are accounted for at competitive market prices charged to unaffiliated customers for similar goods.

C) Other disclosures

1. The Company is currently focused on three business segments : Consumables, Equipment and Automation and Flares & Process Equipment Division*. The Company''s organisational structure and governance processes are designed to support effective management of multiple businesses while retaining focus on each one of them.

2. The Segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

3. The geographical information considered for disclosure are :

(i) Sales within India

(ii) Sales outside India

4. No single external customer represents 10% or more of the Company''s revenue from operations for the year ended 31 March 2022 and 31 March 2021.

* Earlier known as "Projects".

Note 53 - Fair value measurements Financial assets and liabilities

All the above amounts are net of provisions for impairments.

I. Fair value hierarchy

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. This section explains the judgments and estimates made in determining the fair values of the financial instruments that are

(a) recognised and measured at fair value and,

(b) measured at amortised cost and for which fair values are disclosed in the financial statements.

To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. For example, listed equity instruments that have quoted market price.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the- counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs are not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities, contingent consideration and indemnification asset included in level 3.

II. Valuation techniques used to determine fair value

Significant valuation techniques used to value financial instruments include:

â¢ the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date.

The fair values for Security deposits, loan to employees and deposits are based on discounted cash flows using a discount rate determined considering the borrowing rate charged by the bank on the loan facility availed.

During the years mentioned above, there have been no transfers amongst the levels of hierarchy.

The carrying amounts of trade receivables, cash and bank balances, current loans, other current financial assets, current borrowings, other current financial liabilities and trade payables are considered to be approximately equal to the fair value.

The fair values computed above for assets measured at amortised cost are based on discounted cash flows using a current borrowing rate. They have been classified at level 2 in fair value hierarchy due to the use of valuation techniques which measure the use of observable market data.

Note 54- Financial risk management

The company is exposed primarily to fluctuations in foreign currency exchange rates, credit quality and liquidity management which may adversely impact the fair value of its financial assets and liabilities. The Company has a risk management policy which covers risk associated with the financial assets and liabilities. The risk management policy is approved by the Board of Directors. The focus of the management is to assess the unpredictability of the financial environment and to mitigate potential adverse effect on the financial performance of the company. The Company''s principal financial assets include loans, investments, trade and other receivables, and cash and cash equivalents that derive directly from its operations. The Company also holds investments in mutual funds and bonds.

A) Credit risk

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms and obligations. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and credit worthiness of the customer on continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. The financial instruments that are subject to concentration of credit risk principally consist of trade receivables, loans, cash and bank balances and bank deposits.

To manage credit risk, the Company follows a policy of advance payment or credit period upto 30 days to reputed customers. In case of foreign receivables, majority of the sales are made either against advance payments or by way of letter of credit. The credit limit policy is established considering the current economic trends of the industry in which the company is operating. Also, the trade receivables are monitored on a periodic basis for assessing any significant risk of non-recoverability of dues and provision is created accordingly.

Bank balances are held with only high rated banks and majority of other security deposits are placed majorly with government agencies.

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. The Company''s objective is to maintain optimum levels of liquidity and to ensure that funds are available for use as per requirement. The liquidity risk principally arises from obligations on account of following financial liabilities viz. borrowings, trade payables and other financial liabilities.

The Company''s corporate finance department is responsible for liquidity and funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.

The maturity profile of the Company''s financial liabilities based on contractual undiscounted payment at each reporting date is :

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: Foreign currency risk, interest rate risk and price risk. The company''s exposure to market risk is primarily on account of foreign currency risk and price risk.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk on their receivables, payables and bank balances which are held in uSD, AED, KWD and EuR. The fluctuation in the exchange rate of INR relative to uSD, AED, KWD and EuR may have a material impact on the Company''s assets and liabilities.

In respect of the foreign currency transactions, the Company manages the exchange rate exposure by entering into forward contracts where the exposure is significant. Further, some of the exposures are kept open since the management believes the same will be offsetted by the corresponding receivables and payables which will be in the nature of natural hedge.

(ii) Price Risk

The Company is exposed to price risk from its investment in mutual fund and bonds classified in the balance sheet at fair value through profit or loss.

To manage its price risk arising from the investment, the Company has invested in the mutual funds and bonds after considering the risk and return profile of the said investments i.e. the debt profile of the investments indicates that the debt has been given to creditworthy banks and other institutional parties and equity investment is made after considering the performance of the stock.

Note 55 - Capital Management

The Company''s objectives when managing capital are to

â¢ safeguard their ability to continue as a going concern, so that they can continue to provide returns to shareholders and benefits to other stakeholders, and

â¢ maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders.

The Company monitors its capital by using gearing ratio, which is net debt divided by total equity. Net debt includes interest bearing loans. Total equity comprises of Equity share capital, General reserve, Capital redemption reserve and Retained earnings.

Note 60- Revenue from contracts with customers: Ind AS 115

The Company is engaged in providing welding Products Technologies and Services, customized solutions for multi-disciplinary projects and contracts related to refineries, oil and gas, petrochemicals, fertilizers, steel plants, pharma, water and other chemical process industries.

The Company determines revenue recognition through the following steps:

1. Identification of the contract, or contracts, with a customer.

2. Identification of the performance obligations in the contract.

3. Determination of the transaction price.

4. Allocation of the transaction price to the performance obligations in the contract.

5. Recognition of revenue when, or as, we satisfy a performance obligation.

a) Disaggregated revenue information

The Company has three reportable segments of its business :

(i) Consumables

(ii) Equipment and automation

(iii) Flares & Process Equipment Division*

(ii) Significant changes in the contract assets and the contract liabilities balances during the year are as follows:

1. The significant changes in contract Assets includes contracts are billed during the year for an amount of Rs. 186 lakhs (31 March 2021: Rs. 3,787 lakhs) and unbilled revenue written off during the year Rs. 3 lakhs (Previous year : 1,320 lakhs).

2. The significant changes in contract liabilities includes customer and distributors advance during the year increased by Rs. 298 lakhs (31 March 2021 increased by Rs. 111 lakhs).

Note 63- Corporate Social Responsibility :

The Company has formed a Corporate Social Responsibility (CSR) Committee as required under Section 135 of the Companies Act, 2013. The Company is required to spend Rs. 48.46 lakhs as per Section 135(5). However, the Company has spent Rs. 47.36 lakhs on the activities mentioned in Schedule VII to the Companies Act, 2013. The Company had spent Rs. 1.10 lakh excess in previous financial year and hence eligible for set off, against current financial year obligation.

Note 65 - The Board has recommended a final dividend for the financial year 2021-22 @ Rs.12.5 per share, i.e. 125% of the face value of Rs.10 each.

Note 66 - The Company evaluated subsequent events from the balance sheet date to 20 May 2022, the date at which the financial statement were available to be issued and determined that there are no item to report.

Note 67 - Amounts below Rs 0.50 lakh have been rounded off.

The accompanying notes form an integral part of the standalone financial statements

This is a summary of significant accounting policies and other explanatory information referred to in our other report of even date.

Mar 31, 2018

I. Background of the Company

Ador Welding Limited (âthe Companyâ) was incorporated in the year 1951 and is one of Indiaâs leading player in the field of Welding Products, Technologies and Services. The Company is also engaged in providing customized solutions for multi-disciplinary projects and contracts related to refineries, oil and gas, petrochemicals, fertilizers, steel plants, pharma, water and other chemical process industries. The Company is a public limited company and domiciled in India and its shares are listed on two recognised stock exchanges in India - the Bombay Stock Exchange Limited (BSE) and the National Stock Exchange (India) Limited (NSE). The registered and corporate office of the Company is situated at Ador House, 6, K. Dubash Marg, Fort, Mumbai.

The separate financial statements were authorised for issue in accordance with the resolution of the Board of Directors on 30 May 2018.

Estimation of fair value

This fair value is based on valuations performed by an accredited independent valuer. The fair value measurement is based on comparable sales approach. The fair value measurement is categorised in level 2 of fair value hierarchy.

(c) The Company has no restrictions on the realisability of its investment property and no contractual obligations to purchase, construct or develop investment property or for repairs, maintenance and enhancements.

Notes:

(a) Ador Welding Academy Private Ltd (AWAPL) is a 100% subsidiary of the Company. The Board of Directors of AWAPL through its board meeting held on 28 April 2016 resolved to issue further shares to its existing shareholders through rights issue of 29 lacs equity shares of Rs. 10 each at par, aggregating to Rs. 290 lacs in the ratio of 290 equity shares for every share held as on 28 April 2016. Further, the Company had resolved to subscribe to the rights issue of 29 lacs equity shares of AWAPL of Rs. 10 each at par, aggregating to Rs. 290 lacs in their Board meeting held on 10 May 2016, which had been subscribed on 23 May 2016 and said shares were issued during the financial year 2016-17.

(b) Investment in Plasma Laser Technologies Limited (PLT)-

The Company has an investment of Rs. 927 lacs (Previous year Rs. 927 lacs) in PLT, PLT had incurred losses since the date of acquisition, the accumulated losses of PLT as at 31 March 2014 exceeded its net worth. The Company had evaluated its investment for the purpose of determination of potential diminution in value and based on such evaluation and considering the underlying factors including downturn in business and decrease in related activities, had recognised a provision for diminution in the value of investment in PLT as at 31 March 2014 amounting to Rs. 927 lacs .

Notes:

(a) Secured by letter of credit

(b) Includes an amount of Rs. 307 lacs (31 March 2017: Rs. 333 lacs, 1 April 2016: Rs. 320 lacs) on account of retention money of Project engineering business division.

* Amount below Rs. 0.49 lac has been rounded off, as per norms of the Company

Note 2 A- Rights, preferences and restrictions

The Company has only one class of shares referred to as equity shares having a par (face) value of Rs. 10 per share. Each shareholder is eligible for one vote per share held.

Note 2 B- The Company has not issued any bonus shares or shares for consideration other than cash nor has there been any buyback of shares during five years immediately preceding 31 March 2018.

Note:

(i) The Board has recommended equity dividend of Rs. 5 per share (previous year Rs. 5 per equity share) for the financial year 2017-18. [Refer note 51]

Notes:

(a) Working capital loan, export packing credit facility and cash credit facility are secured by way of hypothecation of Companyâs entire stocks and book debts, both present and future, exclusive charge on the entire plant and machinery and other movable fixed assets of the Company and on the land and building of the Company located at survey no. 59/11/1, 59/11/2, 59/11/3, 59/12 and 59/13 situated at village Masat, Silvassa, Dadra and Nagar Haveli.

(b) Working capital loan, export packing credit facility, cash credit facility are secured by way of

1. First pari passu charge on current assets of the Company, and

2. Exclusive charge on Raipur Manufacturing facility situated at Bilaspur Road, Industrial Estate, Raipur - 493 221, Chattisgarh (movable and non movable fixed assets) of the Company.

Hypothecation (on current asset of the borrower and movable fixed assets of the borrower at Raipur facility) to be created upfront.

Charge perfection within 90 days of from date of 1st Utilisation of WC limits. Mortgage creation and perfection on Raipur facility within 90 days of 1st Utilisation of WC limits. Letter of Undertaking for Buyerâs Credit (LUT) shall be unsecured facility.

(c) Guarantees given by bank to third parties amounting to Rs. 2,281 lacs (31 March 2017: Rs. 2,558 lacs, 1 April 2016: Rs. 1,198 lacs) on behalf of the Company are secured against securities mentioned in (a) above.

This information has been given in respect of such vendors to the extent they could be identified as Micro & Small enterprises on the basis of information available with the Company.

*Amounts below Rs. 0.49 lac have been rounded off, as per norms of the Company.

Note:

(a) Provision of Rs. 63 lacs (31 March 2017: Rs. 64 lacs, 1 April 2016: Rs. 49 lacs) has been recognised for expected warranty claims on welding equipments and goods traded during the current financial year. It is expected that all these expenditures will be incurred in next financial year.

*There was a fire at Silvassa plant on 16 February 2018. The Company suffered a loss of Rs. 99 lacs on account of damage of Inventory, Property, Plant and Equipments and other incidental expenses, which was fully insured. The management has lodged a claim for the same with the insurance company.

Future cash outflows in respect of above matters are determinable only on receipt of judgments / decisions pending at various forums / authorities. The Management does not expect these claims to succeed and accordingly, no provision for the contingent liability has been recognised in the financial statements.

Note 3- Lease arrangements - Operating lease:

The Companyâs significant leasing arrangements are in respect of residential flats, office premises and vehicles taken on non-cancellable lease. The aggregate amount of operating lease rent debited to statement of profit and loss during the year is Rs. 118 lacs (31 March 2017: Rs. 128 lacs)

Note 4- Lease arrangements - Finance lease

Net carrying amount of carrying asset as at balance sheet date - â Nil lacs (31 March 2017: Rs. 2 lacs, 1 April 2016: Rs. 18 lacs) . The minimum future lease rentals and present value of minimum lease rentals payable are as follows:

Note 5- Lease rental

The Company has significant lease arrangement in respect of office premises given on lease. The aggregate amount of rent credited to statement of profit and loss account during the year is Rs. 103 lacs (31 March 2017: Rs. 114 lacs).

Note 6- Balances of certain debtors, advances and creditors are subject to confirmation / reconciliation, if any. In the opinion of the Management such adjustment are not likely to be material.

Note 7 - Employee benefits

As per Indian Accounting Standard-19 âEmployee Benefitsâ, the disclosure of Employee benefits as defined in the Standard are given below:

Brief description of the plans:

The Company has various schemes for employee benefits such as provident fund, superannuation and gratuity. In case of funded schemes, the funds are administered through trustees/ appropriate authorities. The Companyâs defined contribution plans are superannuation, employees state insurance and provident fund as the Company has no further obligation beyond making the contributions. The Companyâs defined benefit plans consists of provident fund and gratuity. The employees of the Company are entitled to compensated absences as per the Companyâs policy.

I. Defined Contribution Plan:

(i) Superannuation fund

(ii) Provident fund

(iii) Employees State Insurance fund

During the year, the Company has recognised the following amounts in the Statement of profit and loss*:

* included in Note 35- âEmployee benefits expensesâ

** includes payment made to regulatory authorities other than to Ador Welding Employees Provident Fund Trust.

II. Defined Benefit Plan :

(a) Contribution to Gratuity fund (funded scheme):

In accordance with Indian Accounting Standard 19, actuarial valuation was done in respect of the aforesaid defined benefit plan of gratuity based on the following assumptions:-

(viii) Sensitivity Analysis:

Gratuity is a lump sum plan and the cost of providing these benefits is typically less sensitive to small changes in demographic assumptions. The key actuarial assumptions to which the benefit obligation results are particularly sensitive to are discount rate and future salary escalation rate. The following table summarizes the impact in percentage terms on the reported defined benefit obligation at the end of the reporting period arising on account of an increase or decrease in the reported assumption by 50 basis points.

* Amounts below Rs. 0.49 lac have been rounded off, as per norms of the Company.

** Amount have been recognised based on the information for the period ended 28 February 2018, 28 February 2017 and 29 February 2016.

*** The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors.

III. Compensated absences*

(i) An amount of â (48) lacs (31 March 2017: Rs. 14 lacs,1 April 2016: Rs. 50 lacs) has been recognised as an expense in the statement of profit and loss and included under Note 35 âEmployee benefits expensesâ.

(ii) Balance sheet reconciliation

Note 8 -Related Party Disclosure:

As per Ind AS 24 âRelated party Disclosuresâ, disclosure of transactions with the related parties as defined in the Accounting Standard are given below:

Notes:

1. Related party relationship is as identified by the Company and relied upon by the auditors.

2. The Company has shared facilities limits offered by HDFC Bank Limited to the extent of Rs. 100 lacs (Previous year Rs. 100 lacs) by earmarking working capital funds in favour of Ador Welding Academy Private Limited.

3. Considering the downturn of the operation, the employees of Plasma Laser Technologies (PLT), had approached Israel court in financial year 2014-15 for the purpose of liquidation and considering the same, Israel court has appointed the Official Liquidator to evaluate various option including revival or liquidation.

Hence, the management believes that the Company has lost its control on the affairs and assets of such subsidiary as the same is now vested with such official liquidator appointed by Israel court. Further management believes that there are no claims expected on the Company on account of PLT.

4. Excludes gratuity and compensated absences provided on the basis of acturial valuation on an overall company basis.

* Amounts below Rs. 0.49 lac have been rounded off, as per norms of the Company.

Note 9 - Segment reporting

The Companyâs chief operating decision maker - Chief Financial Officer examines the Companyâs performance and has identified two reportable segments of its business:

(i) Consumables

(ii) Equipments and Project Engineering Business

The above operating segments have been identified considering:

(i) The internal financial reporting systems

(ii) The nature of the products / processes

(iii) The organisation structure as well as differential risks and returns of these segments.

Revenue and expenses have been accounted on the basis of their relationship to the operating activities of the segment. Expenses, which relate to the Company as a whole and are not allocable to segments on a reasonable basis, have been included under âUnallocable Incomeâ and âUnallocable Expensesâ respectively. Assets and Liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under âUnallocable Assets / Liabilitiesâ. Inter-segment transfers are accounted for at competitive market prices charged to unaffiliated customers for similar goods.

Domestic Segment includes sales to customers located in India and service income accrued in India. Overseas Segment includes sales and services rendered to customers located outside India.

Non-current assets:-

The following are the details of the carrying amount of non current assets, which do not include deferred tax assets, income tax assets and financial assets, by the geographical area in which the assets are located :

C) Major customer

Revenues of approximately Rs. 4,898 lacs (31 March 2017 - Rs. 5,547 lacs) are derived from a single customer. These revenues are attributed to the Equipments and project engineering business segment.

D) Other disclosures

1. The Company has disclosed business segment as its primary segment.

2. The Segment revenue, results, assets and liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

I. Fair value hierarchy

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. This section explains the judgements and estimates made in determining the fair values of the financial instruments that are

(a) recognised and measured at fair value and,

(b) measured at amortised cost and for which fair values are disclosed in the financial statements.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. For example, listed equity instruments that have quoted market price.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over the counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

II. Valuation techniques used to determine fair value

Significant valuation techniques used to value financial instruments include:

The fair values for security deposits, loan to employees and deposits are based on discounted cash flows using a discount rate determined considering the borrowing rate charged by the bank on the loan facility availed.

During the periods mentioned above, there have been no transfers amongst the levels of hierarchy.

The fair values computed above for assets measured at amortised cost are based on discounted cash flows using a current borrowing rate. They have been classified at level 2 in the fair value hierarchy due to the use of valuation techniques which maximise the use of observable market data.

Note 10- Financial risk management

The Company is exposed primarily to fluctuations in foreign currency exchange rates, credit quality and liquidity management which may adversely impact the fair value of its financial assets and liabilities. The Company has a risk management policy which covers risk associated with the financial assets and liabilities. The risk management policy is approved by the Board of Directors. The focus of the management is to assess the unpredictability of the financial environment and to mitigate potential adverse effect on the financial performance of the Company.

The Companyâs principal financial assets include loans, investments, trade and other receivables, and cash & cash equivalents that derive directly from its operations. The Company also holds investments in mutual funds and debentures.

A. Credit risk

Credit risk is the risk of financial loss arising from counter party failure to repay or service debt according to the contractual terms and obligations. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled by analysing credit limits and credit worthiness of the customer on continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. The financial instruments that are subject to concentration of credit risk principally consist of trade receivables, loans, cash & bank balances and bank deposits.

Also, the trade receivables are monitored on a periodic basis for assessing any significant risk of non-recoverability of dues and provision is created accordingly.

Bank balances are held with only high rated banks and majority of other security deposits are placed majorly with government agencies.

B. Liquidity risk

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. The Companyâs objective is to maintain optimum levels of liquidity and to ensure that funds are available for use as per requirement.

The liquidity risk principally arises from obligations on account of following financial liabilities viz. borrowings, trade payables and other financial liabilities.

The Companyâs corporate finance department is responsible for liquidity and funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Companyâs net liquidity position through rolling forecasts on the basis of expected cash flows.

The maturity profile of the Companyâs financial liabilities based on contractual undiscounted payment at each reporting date is :

C. Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices.

Market risk comprises three types of risk: Foreign currency risk, interest rate risk and price risk. The Companyâs exposure to market risk is primarily on account of foreign currency risk and price risk.

(i) Foreign currency risk

The Company is exposed to foreign exchange risk on their receivables, payables and bank balances which are held in USD, AED, KWD and EUR. The fluctuation in the exchange rate of INR related to USD, AED, KWD and EUR may have a material impact on the Companyâs assets and liabilities.

Sensitivity Analysis

The following table demonstrates the sensitivity in USD, EUR, AED and KWD with all other variables held constant. The below impact on the Companyâs profit before tax is based on changes in the fair value of unhedged foreign currency monetary assets and liabilities at balance sheet date:

(ii) Price Risk

The Company is exposed to price risk from its investment in mutual fund and debentures classified in the balance sheet at fair value through profit and loss.

To manage its price risk arising from the investment, the Company has invested in the mutual funds after considering the risk and return profile of the mutual funds.

Note 11 - Capital Management

The Companyâs objectives, when managing capital, are to

- safeguard their ability to continue as a going concern, so that they can continue to provide returns to shareholders and benefits to other stakeholders, and

- maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders.

Note 12- Revenue expenditure incurred during the year on research and development, amounts to Rs. 338 lacs (31 March 2017: Rs. 415 lacs, 1 April 2016: Rs. 371 lacs) (including depreciation Rs. 29 lacs, 31 March 2017: Rs. 23 lacs, 1 April 2016: Rs. 20 lacs) and capital expenditure thereof amounts to Rs. 43 lacs (31 March 2017: Rs. 92 lacs, 1 April 2016: Rs. 14 lacs).

# As on the date of transition, the Company has measured the investments at deemed cost i.e. previous GAAP carrying amounts.

Note 13- First time adoption of Ind AS: A Transition to Ind AS:

These are the Companyâs first separate financial statements prepared in accordance with Ind AS applicable as at 31 March 2018.

The accounting policies set out in note 1 have been applied in preparing the financial statements for the year ended 31 March 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 1 April 2016 (the date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2014 and other relevant provisions of the Act (previous GAAP or Indian GAAP).

An explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows is as follows:

i) Optional exemptions availed Business combinations

The Company has availed the business combination exemption on first time adoption of Ind AS and accordingly the business combinations prior to date of transition have not been restated to the accounting prescribed under Ind AS 103 - Business combinations.

The Company applies the requirements of Ind AS 103 - Business combinations to business combinations occurring after the date of transition to Ind AS.

Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 - Intangible Assets and investment property covered by Ind AS 40 - Investment Properties.

Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment properties at their previous GAAP carrying value.

Investment in subsidiaries, joint controlled entities and associates

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its subsidiaries, joint controlled entities and associates as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition.

Accordingly, the Company has elected to measure all of its investments in subsidiary at their previous GAAP carrying value.

ii) Mandatory exceptions applied Estimates

An entityâs estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP except where Ind AS required a different basis for estimates as compared to the previous GAAP

De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the derecognition requirements in Ind AS 109 retrospectively from a date of the entityâs choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions was obtained at the time of initially accounting for those transactions.

The Company has applied the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.

Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

The Company has classified its financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

All the adjustments on account of Ind AS are non-cash in nature and hence there is no material impact on statement of Cash flows for the year ended 31 March 2017.

* Amounts below Rs. 0.49 lac have been rounded off, as per norms of the Company

Explanations to reconciliations B.1 Reversal of proposed dividend (including tax)

Previous GAAP - Proposed dividends were recognised as a liability as an adjusting event occurring after the balance sheet date

Ind AS - Dividends are non-adjusting events after the balance sheet date and hence recognised as & when approved by the shareholders.

Consequent to the above, dividends proposed (incl. tax thereon) as at 1 April 2016 of Rs. 818 lacs have been reversed in equity. Effect of dividends approved during the year 2016-17 (incl. tax) of Rs. 818 lacs has been recognised in other equity.

B.2 Deferment of revenue Impact on account of deferment of revenue

Previous GAAP - Revenue from sale of goods is recognised on dispatch from the factory premises

Ind AS - Revenue should be recognised when the entity has transferred to the buyer the significant risks & rewards of ownership of goods

Impact on account of Provision for sales return

Previous GAAP - Sales return are accounted as and when they actually occur.

Ind AS - Sales return are accounted on estimated basis. The liability for expected sales returns is recognised at the times of sales. Revenue is presented net of such sales returns.

Impact on account of deferment of freight service

Previous GAAP - Revenue for sale of goods, freight and insurance services is recognised as per the agreed terms. Revenue recognition does not provide guidance on identification of transactions including the requirement to apply the revenue recognition criteria separately to identifiable components or linked transactions.

Ind AS - In an arrangement comprising of more than one performance obligation, the total consideration shall be allocated to each of the obligations i.e. separate component. Revenue for each separate component should be recognised separately as per the respective recognition principles i.e. Sale of goods when the risks and rewards of ownership are transferred to the customer and Sale of services with respect to the stage of completion.

Consequent to the above, the other equity as at 31 March 2017 has decreased by Rs. 59 lacs (1 April 2016: Rs. 86 lacs) and profit and other comphrensive income for the year ended 31 March 2017 increased by Rs 27 lacs.

B.3 Measurement of derivative financial instruments at fair value

Previous GAAP - For derivatives, forward premium (i.e. difference between spot rate on the date of contract and the contractual forward rate) is amortised over the life of the forward contract. Exchange differences on the reporting date are recognised in the statement of profit & loss.

Ind AS - Forward contracts (derivatives) are recognised at fair value on initial recognition and subsequently at fair value through profit or loss.

The gain or loss on settlement of forward contracts recognised under previous GAAP has been restated under Ind AS.

Consequent to the above, the other equity as at 31 March 2017 has decreased by Rs. 13 lacs (1 April 2016: Rs. 0.01 lac) and profit and other comphrensive income for the year ended 31 March 2017 has decreased by Rs 13 lacs.

B.4 Measurement of financial assets at fair value

Impact of financial asset (Loan to subsidiary) measured at amortised cost

Previous GAAP - Interest free loans given to subsidiary were recognised at the gross transaction price and subsequently reduced for repayments.

Ind AS - Loans are financial assets and are initially recognised at fair value and since the loan is from shareholder the difference between the fair value and transaction price is recognised as deemed investment in the subsidiary. Subsequently, loans to subsidiary are measured at amortised cost resulting in interest income recognised in the statement of profit and loss at the effective interest rate.

Impact of financial assets measured at Fair value through profit or loss Previous GAAP - The current investments are measured at lower of cost or fair value

Ind AS - Investment in mutual funds are financial assets. For the purposes of Ind AS 109, mutual fund investments will be considered as debt instruments. Since the cash flows from mutual funds do not represent solely payments of principal and interest (SPPI) criteria, the same will be measured at fair value through profit or loss at each reporting date.

Consequent to the above, the other equity as at 31 March 2017 has increased by Rs. 74 lacs (1 April 2016: Rs. 189 lacs) and profit and other comphrensive income for the year ended 31 March 2017 decreased by Rs. 115 lacs.

B.5 Interest income on unwinding of discount on financial assets

Previous GAAP - The employee loans disbursed at subsidised rate, interest free rent deposits given to lessor are recorded at their gross transaction value.

Ind AS - Loan / deposits given are financial assets and are initially recognised at fair value.

The difference between the fair value and transaction value of the loan / deposits has been recognised as deferred employee cost / prepaid rent and amortised over the agreed period. Subsequently, the loan will be measured at amortised cost resulting into recognition of salary / rent expense and accrual of finance income in the statement of profit & loss.

Consequent to the above, the other equity as at 31 March 2017 has increased by Rs. 14 lacs (1 April 2016: Rs. 0.08 lacs) and profit and other comphrensive income for the year ended 31 March 2017 increased by Rs. 14 lacs.

B.6 Interest expense on unwinding of discount on financial liabilities

Previous GAAP - Interest free rent deposits received from lessees and deposits from trainees / employees were recognised at the gross transaction price.

Ind AS - Interest free deposits are financial liabilities and are initially recognised at fair value.

In case of rent deposits- The difference between the fair value and transaction price is recognised as Advance income and amortised over the agreed term. Deposit is subsequently measured at amortised cost resulting into recognition of rent income / finance income and finance expense in the statement of profit & loss.

Consequent to the above, the other equity as at 31 March 2017 has decreased by Rs. 6 lacs (1 April 2016: Rs. 0.48 lac) and profit and other comphrensive income for the year ended 31 March 2017 decreased by Rs. 6 lacs.

B.7 Reclassification of actuarial gain on employee benefit obligations to Other comprehensive income

Previous GAAP - Actuarial gains/(loss) on defined benefit obligations is recognised in statement of profit & loss.

Ind AS - Actuarial gains/(loss) on defined benefit obligations is recognised in other comprehensive income (OCI).

Consequent to the above, actuarial gains of Rs. 5 lacs and deferred tax liability of Rs 2 lacs, has been recognised in OCI.

B.8 Provision for doubtful debts as per expected credit loss model

Previous GAAP - The provision for doubtful debts are made based on the debtors realisation period and policy framed by the Company i.e. when there is an objective evidence of impairment

Ind AS - An impairment loss shall be recognised as per the expected credit loss model on all financial assets (other than those measured at fair value)

Consequent to the above, the other equity as at 31 March 2017 has decreased by Rs. 6 lacs (1 April 2016: Rs. 12 lacs) and profit and other comphrensive income for the year ended 31 March 2017 increased by Rs. 6 lacs.

B.9 Deferred tax impact

The impact of transition adjustments together with Ind AS mandate of using balance sheet approach (against profit and loss approach in the previous GAAP) for computation of deferred tax has impacted the reserves on date of transition, with consequential impacts to the statement of profit & loss for the subsequent periods.

Note 14- Corporate Social Responsibility :

The Company has formed a Corporate Social Responsibility (CSR) Committee as required under Section 135 of the Companies Act, 2013. The Company is required to spend Rs. 58.29 lacs as per Section 135(5). However, the Company has spent Rs. 32.87 lacs on the activities mentioned in Schedule VII to the Companies Act, 2013

Details of CSR spend for financial year 2017-18:

Total amount spent: Rs. 32.87 lacs Amount unspent: Rs. 25.42 lacs

Note 15- Amounts below Rs. 0.49 lac have been rounded off, as per norms of the Company.

Mar 31, 2017

Note 1 - Background of the Company

Incorporated in 1951, Ador Welding Limited (AWL) is one of Indiaâs leading player in the field of Welding Products Technologies and Services. The Company is also engaged in providing customized solutions for multi-disciplinary projects and contracts related to refineries, oil & gas, petrochemicals, fertilizers, steel plants, pharma, water and other chemical process industries.

Note 2 a - rights, preferences and restrictions attached to shares

The Company has only one class of shares referred to as equity shares having a par (face) value of Rs.10 per share. Each shareholder is eligible for one vote per share held.

Note 2 b - The Company has not issued any bonus shares or shares for consideration other than cash nor has there been any buyback of shares during five years immediately preceding 31 March 2017.

Notes :

(a) Investment in Plasma Laser Technologies Limited (PLT) (Subsidiary) - The Company has an investment of Rs.927 lakhs (Previous year Rs.927 lakhs) in PLT. PLT has incurred losses since the date of acquisition. The accumulated losses of PLT as at 31 March 2014 exceeded its net worth. The Company has evaluated its investment for the purpose of determination of potential diminution in value and based on such evaluation and considering the underlying factors including downturn in business and decrease in related activities, has recognised a provision for diminution in the value of investment in PLT as at 31 March 2014 amounting to Rs.927 lakhs.

(b) Ador Welding Academy Private Ltd (AWAPL) is a 100% subsidiary of the Company. The Board of Directors of AWAPL through its board meeting held on 28 April 2016 resolved to issue further shares to its existing shareholders through rights issue of 29 lakhs equity shares of Rs.10 each at par, aggregating to Rs.290 lakhs in the ratio of 290 equity shares for every share held as on 28 April 2016. Further, the company has resolved to subscribe to the rights issue of 29 lakhs equity shares of AWAPL of Rs.10 each at par, aggregating to Rs.290 lakhs in their Board meeting held on 10 May 2016, which has been subscribed on 23 May 2016.

Note 3 a - disclosure of specified Bank Notes:

As per the Ministry of Corporate Affairs notification G.S.R. 308(E) dated 30 March 2017, every Company shall disclose the details of Specified Bank Notes (SBN) held and transacted during the period from 8 November 2016 to 30 December 2016 in the following manner:

The amount of excise duty disclosed as deduction from turnover is the total excise duty for the year except the excise duty related to the difference between the closing stock and opening stock and excise duty paid, but not recovered for free goods, breakages / damages and captive consumption, which has been included under the head âother expensesâ as âmiscellaneous expensesâ.

Note 4 - Revenue expenditure incurred during the year on research and development, through the natural heads of account, amounts to Rs.415 lakhs (previous year Rs.371 lakhs) (including depreciation Rs.23 lakhs; previous year Rs.20 lakhs) and capital expenditure thereof amounts to Rs.92 lakhs (previous year Rs.14 lakhs).

* Amount below Rs.0.49 lakh has been rounded as per norms of the Company.

Notes:

1. Related party relationship is as identified by the Company and relied upon by the auditors.

2. The Company has shared facilities limits offered by HDFC Bank Limited to the extent of Rs.100 lakhs (Previous year Rs.100 lakhs) by earmarking working capital funds in favour of Ador Welding Academy Private Limited.

Hence, the Management believes that the Company has lost its control on the affairs and assets of such subsidiary as the same is now vested with such official liquidator appointed by Israel court. Further management believes that there are no claims expected on the company on account of PLT. Hence, the same is not considered in related party transactions.

Note 5 - Employee benefits:

The disclosures required as per Accounting Standard 15 - âEmployee Benefits (Revised 2005)â, are as under:

Brief description of the plans:

The Company has various schemes for employee benefits such as provident fund, superannuation and gratuity. In case of funded schemes, the funds are administered through trustees / appropriate authorities. The Companyâs defined contribution plans are superannuation, employees state insurance and provident fund, as the Company has no further obligation beyond making the contributions. The Companyâs defined benefit plans consist of provident fund and gratuity. The employees of the Company are entitled to compensated absences as per the Companyâs policy.

I. Defined contribution plans:

(i) Provident fund

(ii) Superannuation fund

(iii) Employees state insurance fund

During the year, the Company has recognised the following amounts in the statement of profit and loss*:

III. Compensated absences *

(i) An amount of Rs.14 lakhs (Previous year Rs.50 lakhs) has been recognised as an expense in the statement of profit & loss account and included under note 27-âEmployee benefits expenseâ.

(ii) Balance sheet reconciliation

Note 6 - The Company had received an offer letter form Ador Welding Academy Private Limited (AWAPL) with respect to its rights issue of 29 lakhs equity shares of Rs.10 each at par, aggregating to Rs.290 lakhs in the ratio of 290 equity shares for every 1 equity share held as on 28 April 2016, pursuant to the board resolution passed by the board of directors of AWAPL in the board meeting held on 28 April 2016, primarily for its additional working capital, capital expenditure and also for refund of loans, if any.

It had been further resolved by the Board of Directors of the Company in their meeting held on 10 May 2016 to subscribe to the right issue of 29 lakhs equity shares of AWAPL of Rs.10 each at par, aggregating to Rs.290 lakhs.

Note 7- Lease arrangements - operating lease

The Companyâs significant leasing arrangements are in respect of residential flats, office premises and vehicles taken on non-cancellable lease. The aggregate amount of operating lease rent debited to statement of profit & loss during the year is Rs.127 lakhs (Previous year Rs.122 lakhs)

Note 8 - Lease obligation - Finance lease

Net carrying amount of carrying asset as at balance sheet date - Rs.2 lakhs (Previous year Rs.18 lakhs). The minimum future lease rentals and present value of minimum lease rentals payable are as follows:

Note 9 - Lease rental

The Company has significant lease arrangement in respect of office premises given on lease. The aggregate amount of rent credited to statement of profit & loss account during the year is Rs.111 lakhs (previous year Rs.73 lakhs)

Note 10 - Balances of certain debtors, advances and creditors are subject to confirmation / reconciliation, if any. In the opinion of the Management such adjustments are not likely to be material.

Note 11 - The Company has formed a Corporate Social Responsibility (CSR) Committee as required under Section 135 of the Companies Act, 2013. The Company is required to spend Rs.51.67 lakhs as per Section 135(5) of the said Act. However, the Company has spent Rs.41.18 lakhs on the activities mentioned in Schedule VII to the Companies Act, 2013

Details of CsR spend for the financial year 2016-17:

Total amount spent: Rs.41.18 lakhs Amount unspent: Rs.10.49 lakhs

Note 12 - Amounts below Rs.0.49 lakh have been rounded off as per rounding off norms of the Company, note 53 - The figures for the previous year are regrouped / re-arranged, wherever necessary.

Mar 31, 2016

note 1. - rights, preferences and restrictions attached to shares

The Company has only one class of shares referred to as equity shares having a par (face) value of Rs. 10 per share. Each shareholder is eligible for one vote per share held.

note 2. - The Company has not issued any bonus shares or shares for consideration other than cash nor has there been any buyback of shares during five years immediately preceding 31 March 2016.

Notes:

(a) As per transitional provision as stated in paragraph 7(b) of Schedule II to the Companies Act 2013, assets having carrying value but not having remaining useful life as on 1 April 2014, after retaining residual value needs to be written off against the opening balance of retained earnings.

Net carrying value of such fixed assets as on 1 April 2014 aggregates to Rs. 108 Lacs (net of deferred tax assets aggregates to Rs. 55 Lacs) have been adjusted on account of the above.

(b) The Board has proposed dividend of Rs. 5 per share (for previous year, proposed and approved dividend amounts to Rs. 5 per equity share).

Notes:

(a) Investment in Plasma Laser Technologies Limited (PLT) (Subsidiary)- The Company has an investment of Rs. 927 Lacs (Previous year Rs. 927 Lacs) in PLT. PLT has incurred losses since the date of acquisition, the accumulated losses of PLT as at 31 March 2014 exceeded its net worth. The Company has evaluated its investment for the purpose of determination of potential diminution in value and based on such evaluation and considering the underlying factors including downturn in business and decrease in related activities, has recognized a provision for diminution in the value of investment in PLT as at 31 March 2014 amounting to Rs. 927 Lacs .

(b) Ador Welding Academy Private Ltd (AWAPL) is a 100% subsidiary of the Company. AWAPL caters to informed, demanding and resource seeking customers who are at the cutting edge of metallurgy and metal fabrication technology. It forms the backbone of their quest for new generation products, welding techniques and correct welding procedures and has also made a substantial contribution to the technical upgradation of the human resource base in the welding industry.

note 3 - Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs. 371 Lacs (Previous year Rs. 307 Lacs) (including depreciation Rs. 20 Lacs; Previous year Rs. 20 Lacs) and capital expenditure thereof amounts to Rs. 14 Lacs (Previous year Rs. 46 Lacs).

C) other disclosures

1. Segments have been identified in line with the Accounting Standard on "Segment Reporting" (AS - 17) taking into account the organization structure as well as differential risks and returns of these segments.

2. The Company has disclosed business segment as the primary segment.

Notes:

1. Related Party relationship is as identified by the Company and relied upon by the Auditors.

2. Company has paid Rs. Nil (Previous year Rs.74 Lacs) on devolvement of bank guarantee on the Company which was issued to the overseas subsidiary of the Company.

3. The Company has shared facilities limits offered by HDFC Bank Limited to the extent of Rs. 100 Lacs (Previous year Rs.100 Lacs) by ear marking working capital funds in favour of Ador Welding Academy Private Limited.

4. Considering the downturn of the operation, the employees of Plasma Laser Technologies Limited (PLT), had approached Israel court in financial year 2014-15 for the purpose of liquidation and considering the same, Israel court has appointed the Official Liquidator to evaluate various options including revival or liquidation.

Hence, the Management believes that the Company has lost its control on the affairs and assets of such subsidiary, as the same is now vested with such official liquidator appointed by Israel court. Further, the Management believes that there are no claims expected on the Company on account of PLT.

note 4 - Employee Benefits

The dsclosures required as per Accounting Standard 15 - "Employee Benefits (Revised 2005)", are as under:

Brief description of the plans:

The Company has various schemes for employee benefits such as provident fund, superannuation and gratuity. In case of funded schemes, the funds are administered through trustees / appropriate authorities. The Company''s defined contribution plans are superannuation, employees state insurance and provident fund as the Company has no further obligation beyond making the contributions. The Company''s defined benefit plans consists of provident fund and gratuity. The employees of the Company are entitled to compensated absences as per the Company''s policy.

I. Defined contribution plans:

(i) Provident fund

(ii) Superannuation fund

(iii) Employees state insurance fund

III. Compensated Absences*

(i) An amount of Rs. 50 Lacs (Previous year Rs. 39 Lacs) has been recognized as an expense in the statement of profit and loss account and included under Note 26 "Employee benefits expense".

note 5 - The Company has received an offer letter from Ador Welding Academy Private Limited (AWAPL) with respect to its Rights Issue of 29 Lacs Equity Shares of Rs. 10 each at par, aggregating Rs. 290 Lacs in the ratio of 290 Equity Shares for every 1 Equity Share held as on 28 April 2016, pursuant to the board resolution passed by the Board of Directors of AWAPL in the board meeting held on 28 April 2016, primarily for its additional working capital, CAPEX and also for refund of loans, if any.

It has been further resolved by the Board of Directors in their meeting held on 10 May 2016 to subscribe to the Right Issue of 29 Lacs equity shares of AWAPL of Rs. 10 each at par, aggregating to Rs. 290 Lacs.

note 6 - Lease arrangements - operating Lease

The Company''s significant leasing arrangements are in respect of residential flats and office premises taken on cancellable lease. The aggregate amount of operating lease rent debited to statement of profit and loss during the year is Rs. 122 Lacs (Previous year Rs. 85 Lacs).

note 7 - Lease obligation- Finance Lease

Net carrying amount of carrying assets as at balance sheet date - Rs.17 Lacs (Previous year Rs.43 Lacs)

note 8 - Lease Rental

note 9 - Balances of certain debtors, advances and creditors are subject to confirmation / reconciliation, if any. In the opinion of the Management such adjustment are not likely to be material.

note 10 - The Company has formed a Corporate Social Responsibility Committee (CSR) as required under Section 135 of the Companies Act, 2013. The Company is required to spend Rs. 46.64 Lacs as per Section 135(5). However, the Company has spent Rs.18.20 Lacs on the activities mentioned in Schedule VII to the Companies Act, 2013.

details of CsR spend for financial year 2015-16:

Total amount spent: Rs. 18.20 Lacs Amount unspent: Rs. 28.44 Lacs

note11 - Amounts below Rs. 0.49 Lac have been rounded off as per the rounding off norms of the Company.

note 12 - Financial statements for the previous year ended were audited by another firm of Chartered Accountants.

note 13 - The figures for the previous year are regrouped / re-arranged, wherever necessary.

Mar 31, 2015

Note 1- Background of the Company

Incorporated in 1951, Ador Welding Ltd. (AWL) is one of India's leading player in the field of Welding Products, Technologies and Services. The Company is also engaged in providing customized solutions for multi-disciplinary projects and contracts related to Refineries, Oil & Gas, Petrochemicals, Fertilizers, Steel Plants, Pharma, Water, other chemical process industries, etc.

Note 2 - Contingent Liabilities not provided for

(Rs. in lacs) Particulars Year ended Year ended 31st March, 2015 31st March, 2014

a) Disputed Sales Tax as the matters are in appeal (advance paid Rs.31 lacs Previous Year Rs.27 lacs) 287 279

b) Disputed Excise duties as the matters are in appeal (advance paid Rs.2 lacs; Previous Year Rs.2 lacs) 115 123

c) On account of bills discounted by the Company 27 222

d) Bonds / Undertakings given by the Company under Concessional duty / exemption scheme / Waiver of penalty to Customs Authorities. 96 90

e) Standby Letter of Credit issued to Bank Hapoalim Ltd. / HDFC Bank Ltd.- Hongkong for loans drawn / to be drawn by a subsidiary - 73

f) Other matters 152 110

Note 3 - Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs. 307 lacs (Previous year Rs. 296 lacs) (including Depreciation Rs. 20 lacs; Previous year Rs. 29 lacs) and Capital expenditure thereof amounts to Rs. 46 lacs (Previous year Rs. 63 lacs).

C) Other Disclosures

1. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS - 17) taking into account the organisation structure as well as differential risks and returns of these segments.

2. The Company has disclosed Business Segment as the primary segment.

3. Types of Products and Services in each Business Segment:

Business Segment Types of Products and Services

a) Consumables - Electrodes, Wires, Agency Items related to consumables.

b) Equipment & - Equipment, Spares, cutting products and Agency Items Project Engineering related to Equipment and Cutting Products & Design, Engineering, Procurement and commissioning of Flares Incinerators, Furnaces, etc.

4. Segment Revenues, Results, Assets and Liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

Note 4 - Related Parties Disclosure A. Relationships

Relationship Name of the Person / Company

i. Where control exists

a) Holding Company : J. B. Advani & Co. Private Limited

b) Subsidiary Company Ador Welding Academy Private Limited & Fellow subsidiaries Plasma Laser Technologies Ltd. (Under Liquidation)

Plasma Laser Technologies, North America Inc. (Under Liquidation)

Aluminium Hybrid Systems Ltd. (Under Liquidation)

ii. Other related parties with whom transactions have taken place during the year

a) Companies in which Holding Company has significant influence and its associates :

Ador Powertron Limited Ador Fontech Limited Ador Multiproducts Limited Mack Valves India Private Limited Ador Digatron Private Limited Ador Green Energy Private Limited

b) Key Management Personnel Ms. A. B. Advani

Mr. S. M. Bhat

c) Relative of Director Mr. Ajit T. Mirchandani

Notes:

1. Related Party relationship is as identified by the Company and relied upon by the Auditors.

2. The Company has issued Standby Letter of Credit to Bank Hapoalim Limited and HDFC Bank Limited - Hongkong for Rs. Nil (Previous year Rs. 1,127 lacs) towards security for loan taken by M/s. Plasma Laser Technologies Limited.

3. The Company has shared facility limits offered by HDFC Bank Limited to the extent of Rs. 100 lacs by ear marking working capital funds in favour of Ador Welding Academy Private Limited.

4. Considering the downturn of the operation, the Employees of Plasma Laser Technologies Ltd. (PLT), had approached Israel Court in FY 2014-15 for the purpose of liquidation and considering the same, Israel Court has appointed the Official Liquidator to evaluate various options, including revival or liquidation. Hence, the management believes that the Company has lost its control on the affairs and assets of such subsidiary, as the same is now vested with such Official Liquidator appointed by Israel Court. Further, the Management believes that there are no claims expected on the Company on account of PLT.

Note 5 - Employee Benefits

The disclosures required as per Accounting Standard 15 - Employee Benefits (Revised 2005), are as under: Brief description of the Plans:

The Company has various schemes for employee benefits such as provident fund, superannuation and gratuity. In case of funded schemes, the funds are administered through trustees / appropriate authorities. The Company's defined contribution plans are superannuation and provident fund and the Company has no further obligation beyond making the contributions. The Company's defined benefit plans consist of provident fund and gratuity. The employees of the Company are entitled to compensated absences as per the Company's policy.

I. Defined Contribution Plans:

(i) Provident Fund

(ii) Superannuation Fund

(iii) Employees State Insurance Fund

During the year, the Company has recognized the following amounts in the Statement of Profit and Loss*:

*included in Note 27- 'Employee Benefits Expense'

II. Defined Benefit Plans (Disclosure based on actuarial reports):

(a) Contribution to Gratuity Fund (Funded Scheme)

(x) The Liability for compensated absence as at 31st March 2015 aggregates to Rs. 183 lacs as against Rs. 150 lacs in the previous year.

Note 44 - Lease arrangements - Operating Lease

The Company's significant leasing arrangements are in respect of residential flats and office premises taken on cancellable lease. The aggregate amount of operating lease rent debited to Statement of Profit and Loss during the year is Rs. 85 lacs (Previous year Rs. 79 lacs).

Note 6 - Lease Obligation - Finance Lease

Net carrying amount of carrying assets as at Balance Sheet date - Rs. 42 lacs (Previous year Rs. 140 lacs). The minimum future lease rentals and present value of minimum lease rentals payable are as follows:

Note 7 - Amounts below Rs 0.49 lac have been rounded off as per rounding off norms of the Company.

Note 8 - The Figures for the previous year are regrouped / re-arranged, wherever necessary.

Mar 31, 2014

Note 1 - Background of the Company

Incorporated in 1951, Ador Welding Ltd. (AWL) is one of India''s leading players in the field of Welding Products, Technologies & Services. The Company is also engaged in providing customized solutions for multi-disciplinary projects and contracts related to Refineries, Oil & Gas, Petrochemicals, Fertilizers, Steel Plants, Pharma, Water & other chemical process industries.

Note 2 - Contingent Liabilities not provided for

(Rupees in lacs)

Particulars As at As at 31st March,2014 31st March,2013

a) Disputed Sales Tax as the matters are in appeal (advance paid Rs. 27 lacs; Previous Year Rs. 9 Lacs) 279 68

b) Disputed Excise duties as the matters are in appeal (advance paid Rs. 2 lacs; Previous Year Rs. 2 lacs) 123 115

c) On account of bills discounted by the Company 222 130

d) Bonds / Undertakings given by the Company under Concessional duty / exemption scheme / Waiver of penalty to Customs Authorities 90 110

e) Standby Letter of Credit issued to Bank Hapoalim Ltd. / HDFC Bank Ltd. - Hongkong for loans drawn / to be drawn by a subsidiary 73 187

f) Other matters 110 83

Note 3 - Revenue expenditure incurred during the year on Research & Development, through the natural heads of account, amounts to Rs. 296 Lacs (Previous Year Rs. 449 Lacs) (including Depreciation Rs. 29 Lacs; Previous Year Rs. 31 Lacs) and Capital expenditure thereof amounts to Rs. 63 Lacs (Previous Year Rs. 11 Lacs).

Note 4 - Exceptional Items

a) Investment in Plasma Laser Technologies Ltd (PLT) (Subsidiary).

The Company has an investment of Rs. 927 Lacs (PY Rs. 543 Lacs) in PLT and has also issued Standby Letter of Credits (SBLC) to Banks aggregating to Rs. 1,127 Lacs (PY Rs. 187 Lacs) for loans drawn / to be drawn by PLT.

PLT has incurred losses since the date of acquisition. The accumulated losses of PLT as at 31st March 2014 exceeded its net worth. The Company has evaluated its investment for the purpose of determination of potential diminution in value and based on such evaluation and considering the underlying factors including downturn in business and decrease in related activities, has recognized a provision for diminution in the value of investment in PLT as at 31st March 2014 amounting to Rs. 927 Lacs and has also provided for the SBLC amounting to Rs. 1,054 Lacs (being the amount drawn by PLT) both of which have been shown as exceptional items in the Statement of Profit and Loss Account.

b) Surplus on sale of property of Rs 503 Lacs (Refer Note 39B(a))

Note 5 - Employee Benefits

a) An amount of Rs.113 Lacs (Previous year Rs. 130 Lacs) towards defined contribution plans is recognised as expense in the Statement of Profit and Loss.

b) The following table sets out the status of the gratuity plan as required under AS 15 (Revised 2005) and the reconciliation of opening and closing balances of the present value of the defined benefit obligation:

Note 6 - Lease arrangements - Operating Lease

The Company''s significant leasing arrangements are in respect of residential flats and office premises taken on cancellable lease. The aggregate amount of operating lease rent debited to Statement of Profit and Loss during the year is Rs 79 Lacs (Previous year Rs. 89 Lacs)

Note 7 - Lease Obligation - Finance Lease

Net carrying amount of carrying assets as at Balance Sheet date - Rs.141 Lacs (Previous year Rs 170 Lacs)

Note 8 - Amounts below Rs 0.50 lac have been rounded off as per rounding off norms of the Company.

Note 9 - The Figures for the previous year are regrouped/ re-arranged, wherever necessary.

Mar 31, 2013

Note 1 A - Rights, preferences and restrictions attached to shares

The Company has only one class of shares referred fo as equity shares having a par (face) value of Rs. 10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders will be entitled to receive the remaining assets of the Company, after distribution of all the preferential amounts, in proportion to their shareholding.

Note 2 - In the opinion of the Management, no item of current assets, including inventories has a value on realisation in the ordinary course of business, which is less than the amount at which it is stated in the Balance Sheet.

Note 3 - Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs. 448.76 lacs (Previous year Rs. 253.62 lacs) (including Depreciation Rs. 30.80 lacs; Previous year Rs. 36.66 lacs) and Capital expenditure thereof amounts to Rs. 11.45 lacs (Previous year Rs. 64.27 lacs).

Note 4 - Employee Benefits

a) An amount of Rs,118.23 Lacs (Previous year Rs.106.86 lacs) towards Defined Contribution Plans is recognised as expense in the Profit and Loss Account.

b) The following table sets out the status of the gratuity plan as required under AS 15 (Revised 2005) and the reconciliation of opening and closing balances of the present value of the Defined Benefit Obligation.

Mar 31, 2012

Note 1 - Rights, preferences and restrictions attached to shares

The Company has only one class of shares referred to as equity shares having a par (face) value of Rs. 10/- per share. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend.

In the event of liquidation of the Company, the equity shareholders will be entitled to receive the remaining assets of the Company, after distribution of all the preferential amounts, in proportion to their shareholding.

(i) Working Capital facilities from Banks are secured by hypothecation of stocks and other tangible movable assets of the Company, both present & future and book debts in favour of Bank of Baroda and HDFC Bank Limited. The said facilities are also secured by way of pari-passu charge on the entire plant and machinery and other moveable fixed assets of the Company and on the land & building at the Company's Silvassa Unit.

(ii) Guarantees given by banks to third parties amounting to Rs.848.05 lacs; (Previous year Rs. 400.48 lacs) on behalf of the Company are secured against securities mentioned in (i) above.

Note 2 - Contingent Liabilities not provided for

(Rupees in lacs)

Particulars 31.03.2012 31.03.2011

a) Disputed Sales Tax as the matters are in appeal (advance paid Rs.9.21 lacs; Previous year Rs.9.21 lacs) 67.52 67.52

b) Disputed Excise duties as the matters are in appeal (advance paid Rs.3.15 lacs; Previous year Rs.3.15 lacs) 113.78 103.39

c) On account of bills discounted by the Company 999.98 Nil

d) Bonds / Undertakings given by the Company under Concessional duty / exemption scheme to Customs Authorities. 78.79 147.28

e) Other matters 72.09 74.86

Note 3 - Estimated amount of Contracts remaining to be executed on Capital Account and not provided for (Net of advances) 312.90 215.65

Note 4 - In the opinion of the Management, no item of current assets, including inventories has a value on realisation in the ordinary course of business, which is less than the amount at which it is stated in the Balance Sheet.

Note 5 - Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs.253.62 lacs (Previous year Rs. 170.00 lacs) (including Depreciation Rs. 36.66 lacs; Previous year Rs.30.97 lacs) and Capital expenditure thereof amounts to Rs.64.27 lacs (Previous year Rs.69.82 lacs).

C. Other Disclosures:

1. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS - 17) taking into account the organisation structure as well as differential risks and returns of these segments.

2. The Company has disclosed Business Segment as the primary segment.

4. The Segment Revenues, Results, Assets and Liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

Note 6 - Employee Benefits

a) An amount of Rs. 106.86 lacs (Previous year Rs.98.77 lacs) towards defined contribution plans is recognised as expense in the Profit and Loss Account.

c) Provident Fund Liability

In case of certain employees, the Provident Fund contribution is made to a trust administered by the Company. In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of Provident Fund liability based on the assumptions listed below. The assumptions used in determining the present value obligation of the interest rate guarantee under deterministic approach are:- Remaining terms of maturity - 7 years Expected guaranteed interest rate - 8.25% Discount rate for the remaining term to maturity of interest portfolio - 8.60%* takes into account the inflation, promotions and other relevant factors.

Note 7 - The financial statements for the year ended 31st March,2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act 1956. Consequent to the notification under the Companies Act,1956,the financial statements for the year ended 31st March,2012 are prepared under revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.

Note 8 - Significant accounting policies and practices adopted by the Company are as disclosed in the Statement annexed to these Financial Statements as Annexure I.

Mar 31, 2011

1) Secured Loans and Guarantees:

(i) Working Capital facilities from Banks are secured by hypothecation of stocks and other tangible movable assets of the Company, both present and future and book debts in favour of Bank of Baroda and HDFC Bank Limited. The said facilities are also secured by way of pari-passu charge on the entire plant and machinery and other moveable fixed assets of the Company and on the land & building at the Companys Silvassa Unit.

(ii) Guarantees given by banks to third parties amounting to Rs400.48 lacs; (previous year Rs379.51 lacs) on behalf of the Company are secured against securities mentioned in (i) above.

(Rupees in lacs)

2) Contingent Liabilities not provided for : 31.03.2011 31.03.2010

a) Disputed income tax as the matters

are in appeal (advance paid RsNil; previous

year Rs14.38 lacs) Nil 14.38

b) Disputed Sales Tax as the matters are

in appeal (advance paid Rs9.21 lacs; previous

year Rs9.21 lacs) 67.52 67.52

c) Disputed Excise duties as the matters

are in appeal (advance paid Rs3.15 lacs;

previous year Rs3.15 lacs) 103.39 118.38

d) On account of bills discounted by the

Company Nil Nil

e) Bonds / Undertakings given by the

Company under concessional duty / exemption

scheme to Customs Authorities. 147.28 294.31

f) Other matters 74.86 Nil

3) Estimated amount of Contracts remaining

to be executed on Capital Account and not

provided for (Net of advances) 215.65 13.00

4) a) Sundry Creditors in Schedule ÃKÃ to the Accounts include; (i) Rs541.72 lacs (previous year Rs249.95 lacs) due to micro and small enterprises registered under The Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) Rs824.90 lacs (previous year Rs720.21 lacs) due to other creditors. During the year no amounts have been paid beyond the appointed day in terms of the MSME and, there are no amounts paid towards interest. Further, there is no interest accrued / payable under the said Act at the close of the year. b) The disclosure in (a) above is based on the information available with the Company regarding the status of suppliers under the MSME.

5) In the opinion of the Management, no item of current assets, including inventories has a value on realisation in the ordinary course of business, which is less than the amount at which it is stated in the Balance Sheet.

6) Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs170 lacs (previous year Rs146.72 lacs) (including Depreciation Rs30.97 lacs; previous year Rs22.06 lacs) and Capital expenditure thereof amounts to Rs69.82 lacs (previous year Rs0.63 lac).

11) B) i) Turnover quantity is derived on the basis of opening stock plus production and purchases for trading activity, less physical quantities of closing stock.

ii) Annual Installed Capacity in Note 11(A) above is as certified by the Managing Director, and being a technical matter, is accepted by the Auditors as correct.

C) Other Disclosures:

1. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS Ã 17) taking into account the organisation structure as well as differential risks and returns of these segments.

2. The Company has disclosed Business Segment as the primary segment.

3. Types of Products and Services in each Business Segment:

4. The Segment Revenues, Results, Assets and Liabilities include the respective amounts identifiable to each of the segment and amounts allocated on a reasonable basis.

18) Fixed Assets under Schedule ÃE to the Accounts, include net book value of assets at the Companys Ahmednagar division aggregating Rs72.57 lacs, which have been retired from active use. As per the estimates made by the Management, the net realisable value of such fixed assets would atleast be equal to the carrying value of the fixed assets. Hence, in the opinion of the Management, no expected loss needs to be recognised.

19) Employee Benefits:

An amount of Rs77.58 lacs (previous year Rs42.11 lacs) towards defined contribution plans is recognised as expense in the Profit and Loss Account.

The following table sets out the status of the gratuity plan as required under AS-15 (Revised 2005) and the reconciliation of opening and closing balances of the present value of the defined benefit obligation:

*The estimate of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors.

Note : During the year, the Management of Gratuity fund has been outsourced to Life Insurance Corporation of India.

22) Previous years figures have been regrouped wherever necessary.

Mar 31, 2010

1) Secured Loans and Guarantees:

i) Working Capital facilities from Banks are secured by hypothecation of stocks and other tangible movable assets of the Company, both present and future and book debts in favour of Bank of Baroda and HDFC Bank Limited. The said facilities are also secured by way of pari-passu charge on the entire plant and machinery and other moveable fixed assets of the Company and on the land & building at the Companys Silvassa Unit.

ii) Guarantees given by banks to third parties amounting to Rs.379.51 lacs; (Previous year Rs. 315.89 lacs) on behalf of the Company are secured against securities mentioned in (i) above.

(Rupees in lacs)

2) Contingent Liabilities not provided for : 31.03.2010 31.03.2009

a) Disputed income tax as the matters are in appeal (advance paid Rs.14.38 lacs; Previous Year Rs.15.65 lacs) 14.38 15.65

b) Disputed Sales Tax as the matters are in appeal (advance paid Rs.9.21 lacs; Previous Year Rs.9.21 lacs) 67.52 67.52

c) Disputed Excise duties as the matters are in appeal (advance paid Rs.3.15 lacs; Previous Year Rs.1 lac) 118.38 117.99

d) On account of bills discounted by the Company Nil 105.26

e) Bonds/Undertakings given by the Company under concessional duty/exemption scheme to Customs Authorities. 294.31 232.29

3) Estimated amount of Contracts remaining to be executed on Capital Account and not provided for (Net of advances) 13.00 177.57

4) a) Sundry Creditors in Schedule ÃJÃ to the Accounts include (i) Rs.0.99 lac (Previous Year Rs.Nil) due to micro and small enterprises registered under The Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) Rs. 969.17 lacs (Previous Year Rs.1,296.59 lacs) due to other creditors. During the year no amounts have been paid beyond the appointed day in terms of the MSME and, there are no amounts paid towards interest. Further, there is no interest accrued / payable under the said Act at the close of the year.

b) The disclosure in (a) above is based on the information available with the Company regarding the status of suppliers under the MSME.

5) In the opinion of the Management, no item of current assets, including inventories has a value on realisation in the ordinary course of business, which is less than the amount at which it is stated in the Balance Sheet.

6) Revenue expenditure incurred during the year on Research and Development, through the natural heads of account, amounts to Rs 146.72 lacs (Previous year Rs. 77.91 lacs) (including Depreciation Rs.22.06 lacs; Previous year Rs. 25.57 lacs) and Capital expenditure thereof amounts to Rs.0.63 lac (Previous year Rs. 0.52 lac).

Notes : 1. The Companys products are exempt from licencing requirements under New industrial Policy in terms of Notification No.477 (E) dated 25th July 1991 and F.No. 10/43/91-LP dated 02nd August 1991.The Company has registered all its products (including existing products) with Secretariat for Industrial Assistance.

2. Opening Stock,Turnover,Closing Stock in respect of Goods for Resale are included in respective catagories in item no.1 to 3

3. Figures in bracket indicate figures relating to the previous year.

4. Figures have been regrouped wherever necessary.

11) B) i) Turnover quantity is derived on the basis of opening stock plus production and purchases for trading activity, less physical quantities of closing stock.

ii) ÃAnnual Installed Capacity in Note 11(A) is as certified by the Managing Director, and being a technical matter, is accepted by the Auditors as correct.

C) Other Disclosures:

1. Segments have been identified in line with the Accounting Standard on Segment Reporting (AS Ã 17) taking into account the organisation structure as well as differential risks and returns of these segments.

2. The Company has disclosed Business Segment as the primary segment.

7) Disclosure in respect of derivative instruments:

a) Derivative instruments for hedging purposes,outstanding : Nil

8) Fixed Assets under Schedule D to the Accounts, include net book value of assets at the Companys Ahmednagar division aggregating Rs. 76.84 lacs, which have been retired from active use. As per the estimates made by the Management, the net realisable value of such fixed assets would atleast be equal to the carrying value of the fixed assets. Hence, in the opinion of the Management, no expected loss needs to be recognised.

9) Previous years figures have been regrouped wherever necessary

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