Notes to Accounts of Ortin Global Ltd.

Mar 31, 2025

7) Provisions, contingent liabilities and contingent assets
Provisions

A provision is recognised if, as a result of a past event, the Company has a present legal or
constructive obligation that can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation. If the effect of the time value of
money is material, provisions are determined by discounting the expected future cash flows at
a pre-tax rate that reflects current market assessments of the time value of money and the
risks specific to the liability. Where discounting is used, the increase in the provision due to the
passage of time is recognized as a finance cost.

Contingent liabilities

A disclosure for a contingent liability is made when there is a possible obligation or a present
obligation that may, but probably will not, require an outflow of resources. Where there is a
possible obligation or a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made.

Contingent assets

Contingent assets are not recognised in the financial statements. However, contingent assets
are assessed continually and if it is virtually certain that an inflow of economic benefits will
arise, the asset and related income are recognised in the period in which the change occurs.

8) Revenue Recognition

Sale of goods and trade license

Revenue is recognized, when the company substantially satisfies its performance obligation
while transferring a promised good or service to its customers. The company considers the
terms of the contract and its customary business practices to determine the transaction price.
Performance obligations are satisfied at the point of time when the customer obtains controls
of the asset. Revenue is measured based on transaction price, which is the fair value of the
consideration received or receivable, stated net of discounts, returns and value added tax.
Transaction price is recognised based on the price specified in the contract, net of the
estimated sales incentives/ discounts. Accumulated experience is used to estimate and
provide for the discounts/ right of return, using the expected value method.

Other Income
Interest Income

Interest Income mainly comprises of interest on Margin money deposit with banks relating to
bank guarantee. Interest income should be recorded using the effective interest rate (EIR).
However, the amount of margin money deposits relating to bank guarantee are purely current
in nature, hence effective interest rate has not been applied. Interest is recognized using the
time-proportion method, based on rates implicit in the transactions.

9) Borrowing Costs

Borrowing costs consist of interest, ancillary and other costs that the Company incurs in
connection with the borrowing of funds and interest relating to other financial liabilities.
Borrowing costs also include exchange differences to the extent regarded as an adjustment to
the borrowing costs. Borrowing costs directly attributable to the acquisition, construction or
production of an asset that necessarily takes a substantial period of time to get ready for its
intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs
are expensed in the period in which they occur.

10) Tax Expenses

Tax expense consists of current and deferred tax.

Income Tax

Income tax expense is recognized in the statement of profit and loss except to the extent that it
relates to items recognized directly in equity, in which case it is recognized in equity. Current
tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of
previous years.

Deferred Tax

Deferred tax is recognised using the balance sheet method, providing for temporary
differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax
rates that are expected to be applied to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the reporting date. Deferred tax
assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities
and assets on a net basis or their tax assets and liabilities will be realised simultaneously. A
deferred tax asset is recognized to the extent that it is probable that future taxable profits will be
available against which the temporary difference can be utilized. Deferred tax assets are
reviewed at each reporting date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realized.

Dividend distribution tax

Tax on Dividends declared by the Company are recognised as an appropriation of
Profit.

Dividend Distribution Tax is not applicable from April 1,2020.

11) Earnings Per Share

The Company presents basic and diluted earnings per share (“EPS”) data for its ordinary
shares. Basic earnings per share are computed by dividing the net profit after tax by the
weighted average number of equity shares outstanding during the period. Diluted earnings per
share is computed by dividing the profit after tax by the weighted average number of equity
shares considered for deriving basic earnings per share and also the weighted average
number of equity shares that could have been issued upon conversion of all dilutive potential
equity shares.

12) Trade receivables

Trade receivables are initially recognized at fair value and subsequently measured at
amortized cost using effective interest method, less provision for impairment.

13) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to
the end of the financial year which are unpaid. The amounts are unsecured and are presented
as current liabilities unless payment is not due within twelve months after the reporting period.
They are recognized initially at fair value and subsequently measured at amortized cost using
the effective interest method.

Determination of fair values

The Company''s accounting policies and disclosures require the determination of fair value, for
certain financial and non-financial assets and liabilities. Fair values have been determined for
measurement and/or disclosure purposes based on the following methods. When applicable,
further information about the assumptions made in determining fair values is disclosed in the
notes specific to that asset or liability. A fair value measurement of a non-financial asset takes
into account a market participant''s ability to generate economic benefits by using the asset in
its highest and best use or by selling it to another market participant that would use the asset in
its highest and best use.

(i) Property, plant and equipment

Property, plant and equipment, if acquired in a business combination or through an exchange
of non-monetary assets, is measured at fair value on the acquisition date. For this purpose, fair
value is based on appraised market values and replacement cost.

(ii) Intangible assets

The fair value of brands, technology related intangibles, and patents and trademarks acquired
in a business combination is based on the discounted estimated royalty payments that have
been avoided as a result of these brands, technology related intangibles, patents or
trademarks being owned (the “relief of royalty method”). The fair value of customer related,
product related and other intangibles acquired in a business combination has been
determined using the multi-period excess earnings method after deduction of a fair return on
other assets that are part of creating the related cash flows.

(iii) Inventories

The fair value of inventories acquired in a business combination is determined based on its
estimated selling price in the ordinary course of business less the estimated costs of

completion and sale, and a reasonable profit margin based on the effort required to complete
and sell the inventories.

(iv) Investments in equity and debt securities and units of mutual funds

The fair value of marketable equity and debt securities is determined by reference to their
quoted market price at the reporting date. For debt securities where quoted market prices are
not available, fair value is determined using pricing techniques such as discounted cash flow
analysis. In respect of investments in mutual funds, the fair values represent net asset value as
stated by the issuers of these mutual fund units in the published statements. Net asset values
represent the price at which the issuer will issue further units in the mutual fund and the price at
which issuers will redeem such units from the investors. Accordingly, such net asset values are
analogous to fair market value with respect to these investments, as transactions of these
mutual funds are carried out at such prices between investors and the issuers of these units of
mutual funds.

(v) Derivatives

The fair value of foreign exchange forward contracts is estimated by discounting the difference
between the contractual forward price and the current forward price for the residual maturity of
the contract using a risk-free interest rate (based on government bonds). The fair value of
foreign currency option and swap contracts and interest rate swap contracts is determined
based on the appropriate valuation techniques, considering the terms of the contract.

(vi) Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, is calculated based on the present
value of future principal and interest cash flows, discounted at the market rate of interest at the
reporting date. For finance leases the market rate of interest is determined by reference to
similar lease agreements. In respect of the Company''s borrowings that have floating rates of
interest, their fair value approximates carrying value.

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Mar 31, 2024

7) Provisions, contingent liabilities and contingent assets

Provisions

A provision is recognised if, as a result of a past event, the Company has a present legal or
constructive obligation that can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation. If the effect of the time value of
money is material, provisions are determined by discounting the expected future cash flows at
a pre-tax rate that reflects current market assessments of the time value of money and the risks
specific to the liability. Where discounting is used, the increase in the provision due to the
passage of time is recognized as a finance cost.

Contingent liabilities

A disclosure for a contingent liability is made when there is a possible obligation or a present
obligation that may, but probably will not, require an outflow of resources. Where there is a
possible obligation or a present obligation in respect of which the likelihood of outflow of
resources is remote, no provision or disclosure is made.

Contingent assets

Contingent assets are not recognised in the financial statements. However, contingent assets
are assessed continually and if it is virtually certain that an inflow of economic benefits will
arise, the asset and related income are recognised in the period in which the change occurs.

8) Revenue Recognition

Sale of goods and trade license

Revenue is recognized, when the company substantially satisfies its performance obligation
while transferring a promised good or service to its customers. The company considers the
terms of the contract and its customary business practices to determine the transaction price.
Performance obligations are satisfied at the point of time when the customer obtains controls
of the asset. Revenue is measured based on transaction price, which is the fair value of the
consideration received or receivable, stated net of discounts, returns and value added tax.
Transaction price is recognised based on the price specified in the contract, net of the
estimated sales incentives/ discounts. Accumulated experience is used to estimate and
provide for the discounts/ right of return, using the expected value method.

Other Income

Interest Income

Interest Income mainly comprises of interest on Margin money deposit with banks relating to bank
guarantee. Interest income should be recorded using the effective interest rate (EIR). However, the
amount of margin money deposits relating to bank guarantee are purely current in nature, hence
effective interest rate has not been applied. Interest is recognized using the time-proportion
method, based on rates implicit in the transactions.

9) Borrowing Costs

Borrowing costs consist of interest, ancillary and other costs that the Company incurs in
connection with the borrowing of funds and interest relating to other financial liabilities.
Borrowing costs also include exchange differences to the extent regarded as an adjustment to
the borrowing costs. Borrowing costs directly attributable to the acquisition, construction or
production of an asset that necessarily takes a substantial period of time to get ready for its
intended use or sale are capitalised as part of the cost of the asset. All other borrowing costs
are expensed in the period in which they occur.

10) Tax Expenses

Tax expense consists of current and deferred tax.

Income Tax

Income tax expense is recognized in the statement of profit and loss except to the extent that it
relates to items recognized directly in equity, in which case it is recognized in equity. Current
tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to tax payable in respect of
previous years.

Deferred Tax

Deferred tax is recognised using the balance sheet method, providing for temporary
differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax
rates that are expected to be applied to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the reporting date. Deferred tax
assets and liabilities are offset if there is a legally enforceable right to offset current tax
liabilities and assets, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities
and assets on a net basis or their tax assets and liabilities will be realised simultaneously. A
deferred tax asset is recognized to the extent that it is probable that future taxable profits will be
available against which the temporary difference can be utilized. Deferred tax assets are
reviewed at each reporting date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realized.

Dividend distribution tax Tax on Dividends declared by the Company are recognised as an
appropriation of Profit.

Dividend Distribution Tax is not applicable from April 1,2020.

11) Earnings Per Share

The Company presents basic and diluted earnings per share (“EPS”) data for its ordinary
shares. Basic earnings per share are computed by dividing the net profit after tax by the
weighted average number of equity shares outstanding during the period. Diluted earnings per
share is computed by dividing the profit after tax by the weighted average number of equity
shares considered for deriving basic earnings per share and also the weighted average
number of equity shares that could have been issued upon conversion of all dilutive potential
equity shares.

12) Trade receivables

Trade receivables are initially recognized at fair value and subsequently measured at
amortized cost using effective interest method, less provision for impairment.

13) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to
the end of the financial year which are unpaid. The amounts are unsecured and are presented
as current liabilities unless payment is not due within twelve months after the reporting period.
They are recognized initially at fair value and subsequently measured at amortized cost using
the effective interest method.

Determination of fair values

The Company''s accounting policies and disclosures require the determination of fair value, for
certain financial and non-financial assets and liabilities. Fair values have been determined for
measurement and/or disclosure purposes based on the following methods. When applicable,
further information about the assumptions made in determining fair values is disclosed in the
notes specific to that asset or liability. A fair value measurement of a non-financial asset takes
into account a market participant''s ability to generate economic benefits by using the asset in
its highest and best use or by selling it to another market participant that would use the asset in
its highest and best use.

(i) Property, plant and equipment

Property, plant and equipment, if acquired in a business combination or through an exchange
of non-monetary assets, is measured at fair value on the acquisition date. For this purpose, fair
value is based on appraised market values and replacement cost.

(ii) Intangible assets

The fair value of brands, technology related intangibles, and patents and trademarks acquired
in a business combination is based on the discounted estimated royalty payments that have
been avoided as a result of these brands, technology related intangibles, patents or
trademarks being owned (the “relief of royalty method”). The fair value of customer related,
product related and other intangibles acquired in a business combination has been
determined using the multi-period excess earnings method after deduction of a fair return on
other assets that are part of creating the related cash flows.

(iii) Inventories

The fair value of inventories acquired in a business combination is determined based on its
estimated selling price in the ordinary course of business less the estimated costs of
completion and sale, and a reasonable profit margin based on the effort required to complete
and sell the inventories.

(iv) Investments in equity and debt securities and units of mutual funds

The fair value of marketable equity and debt securities is determined by reference to their
quoted market price at the reporting date. For debt securities where quoted market prices are
not available, fair value is determined using pricing techniques such as discounted cash flow
analysis. In respect of investments in mutual funds, the fair values represent net asset value as
stated by the issuers of these mutual fund units in the published statements. Net asset values
represent the price at which the issuer will issue further units in the mutual fund and the price at
which issuers will redeem such units from the investors. Accordingly, such net asset values are
analogous to fair market value with respect to these investments, as transactions of these
mutual funds are carried out at such prices between investors and the issuers of these units of
mutual funds.

(v) Derivatives

The fair value of foreign exchange forward contracts is estimated by discounting the difference
between the contractual forward price and the current forward price for the residual maturity of
the contract using a risk-free interest rate (based on government bonds). The fair value of
foreign currency option and swap contracts and interest rate swap contracts is determined
based on the appropriate valuation techniques, considering the terms of the contract.

(vi) Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, is calculated based on the present
value of future principal and interest cash flows, discounted at the market rate of interest at the
reporting date. For finance leases the market rate of interest is determined by reference to
similar lease agreements. In respect of the Company''s borrowings that have floating rates of
interest, their fair value approximates carrying value.

35. CONTINGENT LIABILITIES:

Estimated amount of contracts remaining to be executed on Capital Accounts and not
provided for - NIL.

Other Contingent Liabilities:

1. GST demands for the financial years 2017-18, 2018-19, 2019-20 and 2020-21 proposed
through show cause notices and demands raised for which either appeals has been filed or yet
to be filed: Rs. 2,432.00 Lakhs.

2. TDS notices raised for the financial years 2008-09 to 2023-24: Rs. 1.88 Lakhs.

39. SEGMENT REPORTING:

The Company''s Directors examines the Company''s performance from a product perspective
and has indentified two reportable segments:

(a) Manufacture: This division involves in manufacturing of Pharmaceuticals, Medical
Formulations.

(b) Trading: This division involves in trading of Pharmaceuticals, Medical Formulations.

Segment revenues and expenses:

The Company has an established basis of allocating purchases to the segments, which is
reasonable and followed consistently. All other Expenses / Income are not specifically
allocable to specific segments and accordingly these expenses are disclosed as unallocated
expenses or income and adjusted only against the total income of the Company.

Segment Assets and Liabilities:

The Company has not segregated segment wise assets and liabilities as there are no segment
wise assets or liabilities except Debtors and Creditors.

Inter segment transfers:

The Company has no inter-segment transfers.

Summary of Segment Information:

40. In the opinion of the Board the Current assets, Loans and advances are approximately of the
value stated if realized in the ordinary course of the business. The provision for depreciation
and all known liabilities are adequate and not in excess of the amount considered reasonably
necessary.

41. The Company is yet to file Satisfaction of Charges to an extent of Rs. 57.20 Lakhs.

42. Confirmation of balances has not been received from any of the Creditors, Debtors and for
Loans & Advances, which are subject to reconciliation. Provision for doubtful debts, if any, in
respect of the above and the consequential adjustment, if any, whether of revenue nature or
otherwise, will be dealt accordingly.

43. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF
SCHEDULE III TO THE COMPANIES ACT 2013, (AS CERTIFIED BY A DIRECTOR): NIL.

44. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT
ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium
Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development
Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro,
Small and Medium Enterprises. The Company is yet to receive the confirmations from them.
Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium
Enterprises.

46. SHARE CAPITAL:

The paid up capital of the company as on 31st March 2024 is Rs. 8,13,13,920/- divided into
81,31,392 equity share of Rs. 10/- each.

47. Despite the net worth of the Company being eroded more than fifty percent and cash losses for
the year under review the accounts were prepared under going concern basis.

48. The financial Statements approved on 30.05.2024 were presented in a different pattern, hence
the board has decided to revise the financial statements to make them compliant of Schedule -
III of Companies Act 2013. There is no change in profit or loss of the Company due to this
revision of financial statements. The revision to the financial statements have been carried out
solely for the presentation of financial statements as per Schedule III of Companies Act 2013
and no additional adjustments have been carried out for any other events occurring after
30.05.2024 (being the date when the financial statements were first approved by the Board of
Directors of the Company).

49. During the year the manufacturing license of the Company has been cancelled by the
concerned regulatory authorities due to the non compliance of provisions of Schedule - M of
Drugs & Cosmetics Act 1940 & rules made thereunder vide Proc. Rc. No. 1741/DD-
NZB/Mfg/2023 dated 03.07.2023. In this scenario the Company has ventured in to trading of
same products instead of upgrading the machinery and continuing the manufacturing. Hence
the Company has sold its entire Property, Plant & Equipment except vehicles and has
disposed off all the obsolete and expired inventories of the Company which were maintained
for the purpose of manufacturing activity and repaid its external debts.

50. The cash balance as on 31.03.2024 amounts to Rs.29.42 Lakhs which given the nature of the
business of the company is relatively on higher side. Since we could not undertake physical
verification of cash on 31.03.2024, we have relied upon the certificate issued by the
management in this regard.

51. The Company has used accounting software for maintaining its books of account for the
financial year ended March 31,2024 but the same does not have a feature of recording audit
trail (edit log) facility and the same has operated throughout the year for all relevant
transactions recorded in the software. As the audit trail feature is not adopted in the first place,
tampering it with or preserving it by the company as per the statutory requirements for record
retention does not arise.

52. All the amounts are rounded off to the nearest lakhs.

53. Previous year figures have been regrouped and restructured wherever necessary.

As per our revised report of even date annexed. For and on behalf of the Board

For MATHESH & RAMANA

CHARTERED ACCOUNTANTS _Sd/-

S. Murali Krishna Murthy

^Sd/- Managing Director

B. V. RAMANA REDDY DIN: 00540632

Partner
M No: 026967

UDIN:24026967BKBPAQ4276 Sd/-

S. Srinivas Kumar

Place: Hyderabad Whole Time Director & CFO

Date: 13.08.2024 DIN: 02010272

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Mar 31, 2018

2.9.2 Rights attached to equity shares

"The Company has only one class of equity shares having a face value of Rs.10/-each. Each holder of equity share is entitled to one vote per share. 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 preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. "

2.25 First-time adoption of Ind AS

These financial statements, for the year ended 31st March 2018, are the first set of financial statements the Company has prepared in accordance with Indian Accounting Standards(IndASs). For periods up to and including the year ended 31st March 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

The Company has prepared financial statements which comply with Ind AS applicable for periods ending on 31st March 2018, together with the comparative period data as at and for the year ended 31st March 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at 1st April 2016,i.e.,the Company''s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1st April 2016 and the financial statements as at and for the year ended 31st March 2017.

Exemptions Applied

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

The Company adopted not to measure any item of property, plant and equipment at its fair value at the Transition Date. Accordingly, on the transition date, the net carrying value of the property, plant and equipment and intangible assets shall be considered as deemed cost for Ind AS purposes.

Estimates

The estimates at 1st April 2016 and at 31st March 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

- FVTPL - Quoted equity shares

- Impairment of financial assets based on expected credit loss model (“ECL model”)

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at 1st April 2016, the date of transition to Ind AS and as of 31st March 2017.

Reconciliation of equity as previously reported under Previous GAAP and that computed under Ind AS

FVTPL Financial assets

Under Indian GAAP, the Company accounted for long term investments in quoted equity shares as investment measured at cost less provision for diminution other than temporary diminution in the value of investments, if any. Under IndAS, the Company has designated such investments as FVTPL investments. Ind AS requires FVTPL investments to be measured at fair value. At the date of transition to Ind As, difference between the instruments fair value and Indian GAAP carrying amount has been recognized as a separate component of equity, in the retained earnings.

Trade receivables

Under Ind AS, impairment allowance has been determined based on Expected Loss model (ECL). Due to ECL model, the company impaired its trade receivable by Rs.40.11 Lakhs on 1st April 2016 which has been eliminated against retained earnings. The company impaired its trade receivable by Rs.30.59 Lakhs on 31stMarch 2017, such increase in impairment has been recognized in the profit the loss account for the year ended 31st Match 17.

Sale of goods

Under Indian GAAP, sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty. Excise duty on sale of goods is included as part of sales in the face of statement of profit and loss. Thus sale of goods under Ind AS for the year ended 31 March 2017 has increased by Rs. 486.66Lakhswith a corresponding increase in other expenses.

2.28 Related Parties

In accordance with the provisions of Ind AS 24 “Related Party Disclosures” and the Companies Act, 2013, Company''s Directors, members of the Company''s Management Council and Company Secretary are considered as Key Management Personnel. List of Key Management Personnel of the Company is as below:

- Mr. S. Murali Krishna Murthy - Managing Director

- Mr. G VenkataRamana - Joint Managing Director

- Mr. S. Mohan Krishna Murthy - Whole Time Director

- Mr. S. BalajiVenkateswarulu - Whole Time Director

- Mr. S. Srinivas Kumar - Whole Time Director

- Bh. SatyanarayanaRaju - Whole Time Director

- Mr. J R K PandurangaRao - Independent Director

- Mr. M. Tippayya - Independent Director

- Mr. K. PradyumnaTeja - Independent Director

- Mr. T. Seshagiri - Independent Director

- Mr. B. Gopala Reddy - Independent Director

- Mrs.LaxmiSravaniDasari - Non Executive Director

- Mr.Bh. SatyanarayanaRaju- CFO

- Mr.SharvariSwapnilShinde-Company Secretary

2.29 Segment Reporting:

The Company concluded that there is only one operating segment i.e Manufacturing of Pharmaceutical products. Hence, the same becomes the reportable segment for the Company. Accordingly, the Company has only one operating and reportable segment, the disclosure requirements specified in paragraphs 22 to 30 are not applicable. Accordingly, the Company shall present entity-wide disclosures enumerated in paragraphs 32, 33 and 34 of Ind AS 108.

2.30 Income Taxes:

a. Income tax expense/ (benefit) recognized in the statement of profit and loss:

Income tax expense/ (benefit) recognized in the statement of profit and loss consists of the following:

2.32 Financial Instruments:

Set out below, is a comparison by class of the carrying amounts and fair value of the financial instruments, other than those with carrying amounts that are reasonable approximations of fair values

2.33 Financial Risk Management:

The Company’s activities expose it to a variety of financial risks, including credit risk, liquidity risk and Market risk. The Company’s risk management assessment and policies and processes are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Board of Directors, risk management committee and the Audit Committee is responsible for overseeing the Company’s risk assessment and management policies and processes.

a. Credit Risk:

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and investment securities. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The Company establishes an allowance for doubtful debts and impairment that represents its estimate of expected losses in respect of trade and other receivables and investments.

Trade Receivables-The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry and country in which the customer operates, also has an influence on credit risk assessment. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The total trade and other receivables Impairment loss is provided Rs.43.87 lakhs as at 31 March 2018 and Rs.30.59 lakhs at31stMarch 2017.

On account of adoption of Ind AS 109, the Company uses Expected Credit Loss (ECL) model for assessing the impairment loss. For this purpose, it is weighted average of credit losses with the respective risks of default occurring as weights. The credit loss is the difference between all contractual cash flows that are due to an entity as per the contract and all the contractual cash flows that the entity expects to receive, discounted to the effective interest rate.

Financial assets that are neither past due nor impaired - None of the Company''s cash equivalents, including deposits with banks, were past due or impaired as at 31 March 2018.

Liquidity Risks:

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risk to the Company''s reputation.

As of 31 March 2018 and 2017, the Company had unutilized credit limits from banks of NIL and NIL respectively.

As of 31 March 2018, the Company had working capital (current assets less current liabilities) of Rs. 1073.26 lakhs including cash and cash equivalents of Rs.169.22Lakhs and investments in FVTPL financial assets of Rs. 7.84 lakhs .As of 31 March 2017, the Company had working capital of Rs. 772.31 lakhs, including cash and cash equivalents of Rs.143.03 lakhs and investments in FVTPL financial assets of Rs.7.00 Lakhs

The table below provides details regarding the contractual maturities of significant financial liabilities as at 31 March 2018: *Note: The Bank Overdraft and other liabilities are payable on demand.

Market Risks:

Market risk is the risk that changes in market prices such as commodity prices risk, foreign exchange rates and interest rates which will affect the Company’s financial position. Market risk is attributable to all market risk sensitive financial instruments including foreign currency receivables and payables.

Interest rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

CAPITAL MANAGEMENT

The Company''s objective for capital management is to maximize shareholder wealth, safeguard business continuity and support the growth of the Company. The Company determines the capital management requirement based on annual operating plans and long term and other strategic investment plans. The funding requirements are met through equity, borrowings and operating cash flows required.

2.34 Contingent Liabilities and Commitments:

The following are the details of contingent liabilities and commitments:

---

Mar 31, 2015

1. CORPORATE INFORMATION:

Ortin Laboratories Limited ("The Company") was incorporated on 27th October, 1986 and the CIN being L24110AP1986PLC006885. The Company is engaged in the business of Manufacturing and trading of Pharmaceuticals, Drugs and Intermediates.

2. Security Details

Term Loan from Bank is Secured by hypothecation of Fixed Assets and Personal Guarantee of directors of the company excluding Honarary directors.The Company availed Rs.62,08,841/- out of total Sanction of Rs.140 lakhs during the year 2013-14. The Loan is repayble in 80 equated monthly instalments of Rs 1,75,000/- each, due to short availment of term loan the due date may be much earlier. The Loan carried interest @ (BR 4.5%)% p.a. The Company also availed a fresh loan of Rs.270 lakhs during the year. The Loan is repayble in 54 equated monthly instalments of Rs 5,00,000/- each. The Loan carried interest @ (BR 4.5%)% p.a.

Vehicle Loan from Bank is secured by hypothecation of vehicle financed.

b) Cash Credit form Karnataka Bank Limited is secured by present and future raw materials, semi finished goods, finished goods, stores and secured second charge on Fixed Assets of the Company and further secured by personal guarantee of promoter Directors.

3. SALES TAX DEFERMENT:

The sales tax deferment liability amounting to Rs. 11,15,966/- shown under Unsecured Loans are due for repayment from the financial year 2019 onwards. The Government of Andhra Pradesh has granted Sales Tax Deferment for a period of 14 years.

4. CONTINGENT LIABILITIES:

a) The contingent liabilities as on 31st March, 2015 are as follows:

1. Letters of Credit worth Rs. 600.00 lacs were outstanding at the end of the year.

2. With respect to Income Tax Scrutiny Assessment, the department raised a demand of Rs. 12.74 Crores for the F. Y. 2011-12. The company has filed an appeal and the same is pending with the Income Tax Department.

3. Mumbai sales tax authorities raised a demand of Rs. 76.74 lacs for the F. Y 2008-09. The company filed an appeal and the same is pending before the authorities.

4. Excise Department raised a demand of Rs. 10.03 lacs for the F.Y. 2010-11 and F.Y.2011-12. The company filed an appeal and the same is pending for disposal.

b) Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for - NIL

5. SEGMENT REPORTING:

The Company is engaged in the manufacture of Drug Intermediates and Pharmaceuticals. Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

6. SHARE CAPITAL:

The authorized capital of the company is Rs. 20,00,00,000/- divided into 2,00,00,000 equity shares of Rs. 10/- each.

Shareholders' funds of Rs. 16,94,04,000/- are divided into 1,69,40,400 equity shares of Rs. 10/- each.

7. The cash balance as on 31/03/2015 amounts to Rs.58,13,283/- which given the nature of the business of the company is relatively on higher side. Since we could not undertake physical verification of cash on 31/03/2015, we have relied upon the certificate issued by the management in this regard.

8. In the view of Management, no event has taken place to trigger the need for testing its assets for impairment. Accordingly, as per the management's assessment, the carrying values of its assets as at the Balance sheet date are not higher than their corresponding recoverable amounts.

9. In the opinion of the Board the Current assets, Loans and advances are approximately of the value stated if realized in the ordinary course of the business. The provision for depreciation and all known liabilities are adequate and not in excess of the amount considered reasonably necessary.

10. Confirmation of balances has not been received from any of the Creditors, Debtors and for Loans & Advances, which are subject to reconciliation. Provision for doubtful debts, if any, in respect of the above and the consequential adjustment, if any, whether of revenue nature or otherwise, will be dealt accordingly.

11. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro, Small and Medium Enterprises. The Company is yet to receive the confirmations from them. Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium Enterprises.

12. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF SCHEDULE III TO THE COMPANIES ACT 2013, (AS CERTIFIED BY A DIRECTOR):

A. PARTICULARS IN RESPECT OF GOODS MANUFACTURED:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

B. STOCKS, PURCHASES & SALES OF FINISHED GOODS:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

13. The company has not proposed any dividend for the year under review.

14. During the year the company has amortized 20% of preliminary expenses i.e. Rs. 2,06,656/-.

15. The undisputed statutory dues payable pending as at 31/03/2015 for more than six months are Service Tax of Rs. 31,29,376/-, Sales Tax of Rs. 2,03,704/-.

16. An amount of Rs. 14,690/- is outstanding in the books under dividend payable account pertaining to the F.Y. 2012-13 which has to be transferred to unpaid dividend account of the concerned year.

17. Previous year figures have been regrouped and rearranged wherever necessary.

18. All the amounts are rounded off to the nearest rupee.

---

Mar 31, 2014

1) Cash Credit form Karnataka Bank Limited is secured by present and future raw materials, semi finished goods, finished goods, stores and secured second charge on Fixed Assets of the Company and further secured by personal guarantee of promoter Directors.

2. SALES TAX DEFERMENT:

The sales tax deferment liability amounting to Rs. 11,15,966/- shown under Unsecured Loans are due for repayment from the financial year 2019 onwards. The Government of Andhra Pradesh has granted Sales Tax Deferment for a period of 14 years.

3. CONTINGENT LIABILITIES:

a) The contingent liabilities as on 31st March, 2014 are as follows:

Particulars (Rs. In lacs)

In respect of Letters of Credit 600.00

b) Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for - NIL.

4. RELATED PARTY TRANSACTIONS:

Disclosure as required by Accounting Standard AS 18: Related party disclosures issued by the Institute of Chartered Accountant of India (ICAI) are as follows:

(A) (i) Names of the transacting related parties:

SRI SAI KRISHNA MARKETING ASSOCIATES

(ii) Description of the relationship between the parties:

Associate Firm.

(iii) Description of the nature of transaction:

Sales and purchases to/from associates firm in which directors are interested.

(iv) Volume of transaction:

Sales : Rs. 77,87,595/-

Purchases : Rs. 61,30,388/-

Unsecured Loans Rs. 12,00,000/-

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items are pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 2,57,508/-

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(B) (i) Names of the transacting related parties:

ORTIN BIOTECH PRIVATE LIMITED

(ii) Description of the relationship between the parties:

Associate Company.

(iii) Description of the nature of transaction:

Inter corporate Deposits to associate Company in which directors are interested.

(iv) Volume of transaction: Rs. NIL.

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 12,53,000/-.

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(C) (i) Names of the transacting related parties:

WOHLER LABORATORIES PRIVATE LIMITED

(ii) Description of the relationship between the parties:

Enterprise over which key managerial personnel/ their relatives are able to exercise significant influence

(iii) Description of the nature of transaction:

Sales and purchases to/from a company in which directors are interested.

(iv) Volume of transaction:

Sales: Rs. 96,13,355/-

Purchases: Rs. 40,36,681/-

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items are pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 3,83,13,687/-

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL.

5. SEGMENT REPORTING:

The Company is engaged in the manufacture of Drug Intermediates and Pharmaceuticals. Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

6. SHARE CAPITAL:

The authorized capital of the company is Rs. 20,00,00,000/- divided into 2,00,00,000 equity shares of Rs. 10/- each.

Shareholders'' funds of Rs. 16,94,04,000/- are divided into 1,69,40,400 equity shares of Rs. 10/- each.

7. In the opinion of the Board the Current assets, Loans and advances are approximately of the value stated if realized in the ordinary course of the business. The provision for depreciation and all known liabilities are adequate and not in excess of the amount considered reasonably necessary.

8. The balances shown against Sundry Debtors, Sundry Creditors and Advances are subject to confirmation from the respective parties.

9. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro, Small and Medium Enterprises. The Company is yet to receive the confirmations from them. Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium Enterprises.

10. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF SCHEDULE VI TO THE COMPANIES ACT 1956, (AS CERTIFIED BY A DIRECTOR:

A. PARTICULARS IN RESPECT OF GOODS MANUFACTURED:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

B. STOCKS, PURCHASES & SALES OF FINISHED GOODS:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

11. During the year the company has not proposed any dividend.

12. During the year the company has amortized 20% of preliminary expenses i.e. Rs. 2,06,656/-.

13. The undisputed statutory dues payable pending for more than six months are Tax Deducted at Source of Rs. 5,96,213/-, Provident Fund of Rs. 3,00,635/- and Service Tax of Rs. 17,33,342/-.

14. Previous year figures have been regrouped and rearranged wherever necessary.

15. All the amounts are rounded off to the nearest rupee.

---

Mar 31, 2013

1. SALES TAX DEFERMENT:

The sales tax deferment liability amounting to Rs. 11,15,966/- shown under Unsecured Loans are due for repayment from the financial year 2019 onwards. The Government of Andhra Pradesh has granted Sales Tax Deferment for a period of 14 years.

2. CONTINGENT LIABILITIES:

a) The contingent liabilities as on 31st March, 2013 are as follows: Particulars (Rs. In lacs)

In respect of Letters of Credit 600.00

Excise Duty demand based on audit objection raised by department on 19/04/2012 9.35

b) Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for – NIL.

3. RELATED PARTY TRANSACTIONS:

Disclosure as required by Accounting Standard AS 18: Related party disclosures issued by the Institute of Chartered Accountant of India (ICAI) is as follows: (A) (i) Names of the transacting related parties.

SRI SAI KRISHNA MARKETING ASSOCIATES (ii) Description of the relationship between the parties.

Associate Firm. (iii) Description of the nature of transaction.

Sales and purchases to/from associates firm in which directors are interested. (iv) Volume of transaction:

Sales: Rs. 32,36,025/-

Purchases: Rs. 88,29,261/-

Unsecured Loans Rs. 16,50,000/-

The above transactions are not related to the products, which are manufactured at the company''s production facilities and it is only a trading transaction.

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL. (vi) The amounts or appropriate proportions of outstanding items are pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Cr. 53,59,042/-

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(B) (i) Names of the transacting related parties:

ORTIN BIOTECH PRIVATE LIMITED (ii) Description of the relationship between the parties:

Associate Company. (iii) Description of the nature of transaction:

Inter corporate Deposits to associate Company in which directors are interested. (iv) Volume of transaction: Rs. NIL.

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL. (vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet:

Dr. 12,53,000/-. (viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(C) (i) Names of the transacting related parties: WOHLER LABORATORIES PRIVATE LIMITED (ii) Description of the relationship between the parties:

Enterprise over which key managerial personnel/ their relatives are able to exercise

significant influence (iii) Description of the nature of transaction:

Sales and purchases to/from a company in which directors are interested. (iv) Volume of transaction:

Sales: Rs. 25,82,392/-

Purchases: Rs. 4,21,568/-

(v) Other elements of the related party transactions necessary for an nderstanding of the financial statements: NIL. (vi) The amounts or appropriate proportions of outstanding items are pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date. (vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 2,13,45,033/- (viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL.

4. SEGMENT REPORTING:

The Company is engaged in the manufacture of Drug Intermediates and Pharmaceuticals. Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

5. SHARE CAPITAL:

The authorized capital of the company is Rs. 20,00,00,000/- divided into 2,00,00,000 equity shares of Rs. 10/- each.

Shareholders'' funds of Rs. 16,94,04,000/- are divided into 1,69,40,400 equity shares of Rs. 10/- each.

6. In the opinion of the Board the Current assets, Loans and advances are approximately of the value stated if realized in the ordinary course of the business. The provision for depreciation and all known liabilities are adequate and not in excess of the amount considered reasonably necessary.

7. The balances shown against Sundry Debtors, Sundry Creditors and Advances are subject to confirmation from the respective parties.

8. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro, Small and Medium Enterprises. The Company is yet to receive the confirmations from them. Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium Enterprises.

9. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF SCHEDULE VI TO THE COMPANIES ACT 1956, (AS CERTIFIED BY A DIRECTOR:

A. PARTICULARS IN RESPECT OF GOODS MANUFACTURED:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

B. STOCKS, PURCHASES & SALES OF FINISHED GOODS:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

10. During the year the board of directors proposed a dividend of 2.5% on paid up Share Capital.

11. During the year the company has amortized 20% of preliminary expenses i.e. Rs. 2,06,656/-.

12. During the year the following provisions were made:

13. During the year the Company has made Rs.2,55,017/- towards Provision for Gratuity. The Company has not complied actuarial valuation referred in the Accounting Standard 15 "Accounting for Retirement Benefits in the financial Statement of Employers".

14. Disclosure under clause 32 of the Listing Agreement:

(a) Loans and Advances in the nature of Loans to Subsidiary Company NIL

(b) Loans and Advances in the nature of Loans to Associate Company NIL

(c) Loans and Advances in the nature of Loans where there is:

(i) No repayment schedule or repayment beyond 7 years NIL

(ii) No interest or interest below section 372 A of Companies Act NIL

(d) Loans and Advances in the nature of Loans to firms/companies

In which directors are interested Rs. 12,53,000

(e) Investment by the Loanee in the shares of the parent company And subsidiary company, when the company has made a loan

Or advance in the nature of loan NIL

15. Previous year figures have been regrouped and rearranged wherever necessary.

16. All the amounts are rounded of to the nearest rupee.

---

Mar 31, 2012

1. SALES TAX DEFERMENT

The sales tax deferment liability amounting to Rs. 11,15,966/- shown under Unsecured Loans due for repayment from the financial year 2019 onwards. The Government of Andhra Pradesh has granted Sales Tax Deferment for a period of 14 years.

2. CONTINGENT LIABILITIES:

a) The contingent liabilities as on 31st March, 2012 are as follows:

Particulars (Rs. In lacs)

In respect of Letters of Credit 600.00

Excise Duty demand based on audit objection raised by department on 19/04/2012 9.35

b) Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for – NIL.

3. RELATED PARTY TRANSACTIONS:

Disclosure as required by Accounting Standard AS 18: Related party disclosures issued by the Institute of Chartered Accountant of India (ICAI) is follows: (A) (i) Names of the transacting related parties.

SRI SAI KRISHNA MARKETING ASSOCIATES (ii) Description of the relationship between the parties.

Associate Firm. (iii) Description of the nature of transaction.

Sales and purchases to/from associates firm in which directors are interested. (iv) Volume of transaction:

Sales: Rs. 24,76,198/-

Purchases: Rs. 18,51,651/-

Unsecured Loans Rs. 30,00,000/-

The above transactions are not related to the products, which are manufactured at the company''s production facilities and it is only a trading transaction.

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Cr. 11,02,824/-

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(B) (i) Names of the transacting related parties.

ORTIN BIOTECH PRIVATE LIMITED

(ii) Description of the relationship between the parties.

Associate Company.

(iii) Description of the nature of transaction.

Inter corporate Deposits to associate Company in which directors are interested.

(iv) Volume of transaction: Rs. 11,42,000/-

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 12,53,000/-

(viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL

(C) (i) Names of the transacting related parties.

WOHLER LABORATORIES PRIVATE LIMITED

(ii) Description of the relationship between the parties.

Enterprise over which key managerial personnel/ their relatives are able to exercise significant influence

(iii) Description of the nature of transaction.

Sales and purchases to/from a company in which directors are interested.

(iv) Volume of transaction:

Sales: Rs. 1,47,70,905/-

Purchases: Rs. 30,07,338/-

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date.

(vii) Outstanding items pertaining to the related party as on the date of Balance sheet: Dr. 1,43,09,144/- (viii) Amounts written off or written back in the period in respect of debts due from or to related parties: NIL.

4. SEGMENT REPORTING: The Company is engaged in the manufacture of Drug Intermediates and Pharmaceuticals. Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

5. SHARE CAPITAL:

The authorized capital of the company is Rs. 20,00,00,000/- divided into 2,00,00,000 equity share of Rs. 10/- each.

Shareholders'' funds of Rs. 16,94,04,000/- divided into 1,69,40,400 equity share of Rs.10/- each.

6. In the opinion of the Board the Current assets, Loans and advances are approximately of the value stated if realized in the ordinary course of the business. The provision for depreciation and all known liabilities are adequate and not in excess of the amount considered reasonably necessary.

7. The balances shown against Sundry Debtors, Sundry Creditors and Advances are subject to confirmation from the respective parties.

8. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro, Small and Medium Enterprises. The Company is yet to receive the confirmations from them. Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium Enterprises.

9. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF SCHEDULE VI TO THE COMPANIES ACT 1956, (AS CERTIFIED BY A DIRECTOR:

A. PARTICULARS IN RESPECT OF GOODS MANUFACTURED:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

B. STOCKS, PURCHASES & SALES OF FINISHED GOODS:

Since the products involved are voluminous, according to the management it is not possible to give product wise details.

10. During the year the company has received Rs. 2,42,750/- towards electricity subsidy from APSEB pertaining to the financial year 2008-09 and the same was shown under Other Income.

11. During the year the board of directors proposed a dividend of 5% on paid up Share Capital.

12. During the year the company has amortized 20% of preliminary expenses i.e. Rs. 11,64,675/-.

13. During the year the following provisions were made:

14. Disclosure under clause 32 of the Listing Agreement:

(a) Loans and Advances in the nature of Loans to Subsidiary Company NIL

(b) Loans and Advances in the nature of Loans to Associate Company NIL

(c) Loans and Advances in the nature of Loans where there is:

(1) No repayment schedule or repayment beyond 7 years NIL

(2) No interest or interest below section 372 A of Companies Act NIL

(d) Loans and Advances in the nature of Loans to firms/companies

In which directors are interested Rs. 12,53,000

(e) Investment by the Loanee in the shares of the parent company

And subsidiary company, when the company has made a loan

Or advance in the nature of loan NIL

15. Previous year figures have been regrouped and rearranged wherever necessary.

16. All the amounts are rounded of to the nearest rupee.

---

Mar 31, 2010

1. SECURED LOANS:

a) Term Loans from Kamataka Bank Limited is secured by hypothecation of Plant & Machinery and other Fixed Assets and second charge on current assets of the Company and further secured by Personal Guarantee of Promoter Directors.

b) Cash Credit from Karnataka Bank Limited is secured by present and future raw materials, semi finished goods, finished goods, stores and secured second charge on Fixed Assets of the Company and further secured by personal guarantee of promoter Directors.

c) Vehicle Loans are secured by hypothecation of specified vehicles acquired.

2. During the year Sales Tax assessment for the financial year 2004-05 and 2007-08 was completed and an amount of Rs. 52,187 and Rs. 5,830 was paid against the demand of the department.

3. RESEARCH & DEVELOPMENT EXPENSES:

During the year the company has incurred revenue expenditure pertaining to Research and Development of Rs. 11,78,115/-. Revenue expenditure is shown under respective heads of expenditure. There is no capital expenditure on Research and Development.

4. EMPLOYEE STOCK OPTION SCHEME:

During the year the company has not issued any employee stock option scheme.

5. SALES TAX DEFERMENT:

The sales tax deferment liability amounting to Rs. 11,15,966/- shown under Unsecured Loans due for repayment from the financial year 2019 onwards. The Government of Andhra Pradesh has granted Sales Tax Deferment for a period of 14 years.

6. CONTINGENT LIABILITIES:

a) There were no contingent liabilities as on 31st March, 2010.

b) Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for - NIL.

7. RELATED PARTY TRANSACTIONS:

Disclosure as required by Accounting Standard AS 18: Related party disclosures issued by the Institute of Chartered Accountant of India (ICAI) is follows:

(A) (i) Names of the transacting related parties.

SRI SAI KRISHNA MARKETING ASSOCIATES

(ii) Description of the relationship between the parties. Associate Firm.

(iii) Description of the nature of transaction.

Sales and purchases to/from associates firm in which directors are interested.

(iv) Volume of transaction:

Sales: Rs. 2,26,47,023/-

Purchases: Rs. 21,95,891/-

The above transactions are not related to the products, which are manufactured at the companys production facilities and it is only a trading transaction.

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date: NIL.

(B) (i) Names of the transacting related parties.

ORTIN BIOTECH PRIVATE LIMITED

(ii) Description of the relationship between the parties. Associate Company.

(iii) Description of the nature of transaction.

Inter corporate Loan to associate Company in which directors are interested.

(iv) Volume of transaction:

Loan outstanding: Rs. 1,11,000/-

(v) Other elements of the related party transactions necessary for an understanding of the financial statements: NIL.

(vi) The amounts or appropriate proportions of outstanding items pertaining to related parties at the balance sheet date and provisions for doubtful debts due from such parties at that date: NIL.

8. SEGMENT REPORTING:

As the companys business activities falls within single segment viz., Pharmaceutical and allied Products the disclosure requirement of Accounting Standard 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

9. SHARE CAPITAL:

The paid up capital of the company is Rs. 3,67,04,000/- divided into 36,70,400 equity shares of Rs. 10/- each as on 31st March, 2010..

During the year 2010-11 the company has allotted 15,00,000 warrants to the Promoters & others at an issue price of Rs. 18/- each. Of which, 10,30,000 warrants are converted into 10,30,000 equity shares of Rs.10/- each with a premium of Rs.8/- per share.

10. In the opinion of the Board the Current assets, Loans and advances are approximately of the value stated if realized in the ordinary course of the business. The provision for depreciation and all known liabilities are adequate and not in excess of the amount considered reasonably necessary.

11. The balances shown against Sundry Debtors, Sundry Creditors and Advances are subject to confirmation from the respective parties.

12. DISCLOSURE UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006:

As regards to the compliance of provisions relating to the dues to Micro, Small and Medium Enterprises in terms of Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006, the Company has sent letters to the Creditors to confirm whether they are Micro, Small and Medium Enterprises. The Company is yet to receive the confirmations from them. Hence, the Company could not quantify the dues, if any to the Micro, Small and Medium Enterprises.

13. ADDITIONAL INFORMATION PURSUANT TO PARAGRAPHS 3 & 4 OF PART II OF SCHEDULE VI TO THE COMPANIES ACT 1956, (AS CERTIFIED BY A DIRECTOR):

A. PARTICULARS IN RESPECT OF GOODS MANUFACTURED:

Since the products involved are voluminous, According to the management it is not possible to give product wise details.

B. STOCKS, PURCHASES & SALES OF FINISHED GOODS:

Since the products involved are voluminous, According to the management it is not possible to give product wise details.

14. During the year it was proposed to declare dividend of 8% per each equity share.

15. During the year the company has amortized 20% of preliminary expenses i.e. Rs. 9,58,000/-.

16. Previous year figures have been regrouped and rearranged wherever necessary.

17. All the amounts are rounded of to the nearest rupee.