Notes to Accounts of Paragon Fine & Speciality Chemical Ltd.

Mar 31, 2025

Terms/rights attached to equity shares

The company has only one class of equity shares having a par value of ? 10 per share. Each holder of equity shares is entitled for one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive 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.

Equity shares movement during the 5 years preceding March 31, 2025

i) The company allotted 35,00,000 equity shares as fully paid up bonus shares by capitalisation of reserve & surplus balance during the FY 202223.

ii) The company allotted 1,08,00,000 equity shares as fully paid up bonus shares by capitalisation of reserve & surplus balance during the FY 202324.

iii) The Company has completed Initial Public Offer of 51,66,000 Equity Shares of the face value of Rs.10 each at an issue price of Rs.100 per Equity Share, aggregating to Rs. 516.60 Million during the FY 2023-24.

C. Securities Offered - Primary Security :-

All vehicle loans are secured by the hypothecation of the respective vehicles purchased out of the said loans.

II) Unsecured Loan From Directors & Relatives :-

The said loans are repayable on demand when there is surplus cash available with the company. Based on the management''s assessment of repayment the same has been classified as non-current.

A) Cash Credit - YES Bank Limited:-Collateral Security :-

1. Exclusive charge by way of Hypothecation on current asset and movable fixed assets for both present and future.

2. Equitable/Registered mortgage on property situated at:

a) Equitable Mortgage of Existing property located at A-5, Paras Bunglows Part-1, Opp. Govt. Tubewell, Near Telephone Exchange, Bopal Ahmedabad.

b) Equitable Mortgage of Existing property located at Parshwanath Tower, 10th Floor, Nr. Pakwan Restaurant S G highway, Ahmedabad.

c) Equitable Mortgage of Existing property located at 603, Royal Chinmay Tower, Near juges bunglow char rasta, Setellite road, Ahmedabad

d) Equitable Mortgage of Existing property located at 013, Groud Floor, Sunrise Shopping mall, Near Swaminarayan Tample, Vasrtapur, Ahmedabad.

e) Equitable Mortgage of Existing property located at Plot No. 4 & 5, The Viramgam Co. Op. Industrial Estate Limited, Nr. Balapir Darga, Viramgam, Hansalpur, Gujarat- 382150

f) Equitable Mortgage of Existing property located at A/07, milenium Plaza, Nr. Mansi Circle, Ahmedabad-380015.

3. Personnel Guarantee

(A) Mr. Pravinchandra J Vasolia

(B) Mr. Kishorbhai Patolia

(C) Mr. Vallabhbhai Savaliya

4. Rate Of Interest

Effective rate of interest is 8.40% which is 3.50% (spread) over and above marked up Yes bank External Benchmark Lending Rate

B) Cash Credit - HDFC Bank Limited*:-

HDFC Bank Limited has Sanctioned ^38,00,00,000 to the company pursuant to Sanction Letter No. 89272755 dated 29th May,2024 but till date company has not started Utilization of this Cash Credit limit sanctioned.

Collateral Security :-

1. Exclusive charge by way of Hypothecation on current asset and movable fixed assets for both present and future.

2. Equitable/Registered mortgage on property situated at:

a) Equitable Mortgage of Existing property located at Office no:1000/1, Parshwa Tower, Kant Appt. Co. Op. House. Society, Near Pakwan hotel, Bodakdev,Ahmedabad.

b) Equitable Mortgage of Existing property located at Plot 4, Viramgam Co. Op. Industrial Estate, Oppo. Balapir Dargah, Viramgam-382150

c) Equitable Mortgage of Existing property located at Plot 5, Viramgam Co. Op. Industrial Estate, Oppo. Balapir Dargah, Viramgam-382150

d) Equitable Mortgage of Existing property located at Office no:1003/B, Parshwa Tower, Kant Appt. Co. Op. House. Society, Near Pakwan hotel, Bodakdev,Ahmedabad.

3. Personnel Guarantee

(A) Mr. Pravinchandra J Vasolia

(B) Mr. Kishorbhai Patolia

(C) Mr. Vallabhbhai Savaliya

(D) Mr. Rutesh Savaliya

(E) Mr. Shivam Patolia

4. Rate Of Interest

Effective rate of interest is 9%

‘Refer Disclosure of (m) of Additional Regulatory Disclosures As Per Schedule III Of Companies Act, 2013 under (N) of Additional Information Note-25

(A) Disclosures as per Accounting Standard 15 - Employee Benefits a. Gratuity

Details of the company’s post-retirement gratuity plans for its employees including whole-time directors are given below, which is certified by the actuary and relied upon by the auditors.

(i) Valuation Method : Projected unit credit Method

b. Compensated Absences

As per the policy followed by the company, amounts payable towards compensated absences are paid to the employees on calendar year basis and no leaves are carried forward. For the amount due upto the March 31,2025 has been provided for in the books of accounts.

(H) Balances of Trade Payables and Receivables to/from various parties/authorities, and Loans & advances are subject to confirmation from the respective parties, and necessary adjustments if any, will be made on its reconciliation.

(I) In the Opinion of the Board of Directors the aggregate value of current assets, loans and advances on realization in ordinary course of business will not be less than the amount at which these are stated in the Balance Sheet.

(J) Significant Events Occuring After the Balance Sheet Date

There is no significant subsequent event that would require adjustments or disclosure in the financial statements as on the balance sheet date.

(K) As the Company''s business activities fall within single primary business segment and in the opinion of the management there does not exist separate reportable geographical segment, the disclosure requirements of Accounting Standard 17 - “Segment Reporting”, issued by the Institute of Chartered Accountants of India are not applicable.

(L) The company does not have any pending litigation on its financial position in its financial statements.

(M) Previous year’s figures have been re-arranged and re-grouped, wherever necessary to make them comparable with those of current year.

(N) Additional Regulatory Disclosures As Per Schedule III Of Companies Act, 2013.

Additional Regulatory Information required for preparation of Balance Sheet as given in Companies Act, 2013.

a) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

b) The Company has Fund-based and Non-fund-based limits of Working Capital from Banks and Financial institutions. For the said facility, the submissions made by the Company to its lead bankers based on closure of books of accounts at the year end, the quarterly returns or statements comprising stock statements, statement of trade receivables and trade payables and ageing analysis of the debtors/other receivables, and other stipulated financial information filed by the Company with such banks or financial institutions are generally in agreement with the unaudited books of account of the Company of the respective quarters and no material discrepancies have been observed.

(i) As per information given to us, The company has not filed the stock statement with bank for credit facilty availed from the HDFC because company has not Started utilisation of the cash Credit facility availed during the current year

c) The Company has not been declared as a willful defaulter by any lender who has powers to declare a company as a willful defaulter at any time during the financial year or after the end of reporting period but before the date when the financial statements are approved.

d) The Company has not entered the transaction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Company Act, 1956.

e) There is no Indian Subsidiary Companies, hence disclosure as prescribed under clause (87) of section 2 of the Companies Act 2013 read with Companies (Restrictions on number of Layers) Rules, 2017 is not applicable.

f) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities(intermediaries), with the understanding that the intermediary shall;

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

g) The Company has not received any funds from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall;

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate beneficiaries) or

(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

h) The Company does not have any transactions which is not recorded in the books of accounts but has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

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

* Note: The Company has been served an Order under section 74 of the CGST Act, 2017 - In form of GST DRC-07 dated:-02/05/2025. According to the department, demand is created for the various reasons as mentioned in the said order along with the interest and penalty liabilities thereon for tax period April-20 to Mar-21 amounting to Rs. 96,26,534/-. The Company is preparing a detailed submission against the said order.

k) No such assets held by the company for which Title deeds of Immovable Properties not held in name of the Company.

l) There is no Loans or advances granted to the Promoters, directors, KMP and the relative of their during the period.

m) Company has register all it''s charges within time or extenteded time period given in the companies act, 2013. However Company has registered the Charge of an amount of 35,00,00,000 only while the HDFC bank has sanctioned an Amount of 38,00,00,000 pursuant to Sanction letter number 89272755 dated 29th May,2024 to the company

(P) Issue of Shares

i) Issue of Equity shares through IPO:

The Company has completed Initial Public Offer of 51,66,000 Equity Shares of the face value of Rs.10 each at an issue price of Rs.100 per Equity Share, comprising fresh issue of 51,66,000 shares aggregating to Rs. 516.60 Million. The Equity Shares of the Company were listed on 03rd November, 2023 on SME Plateform of NSE Limited.

ii) IPO Expenses:

The total IPO Expenses incurred Rs.476.59 Lakhs has been adjusted against securities premium account.

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Mar 31, 2024

(A) Disclosures as per Accounting Standard 15 - Employee Benefits a. Gratuity

Details of the company’s post-retirement gratuity plans for its employees including whole-time directors are given below, which is certified by the actuary and relied upon by the auditors.

(i) Valuation Method : Projected unit credit Method

b. Compensated Absences

As per the policy followed by the company, amounts payable towards compensated absences are paid to the employees on calendar year basis and no leaves are carried forward. For the amount due upto the March 31, 2023 has been provided for in the books of accounts.

(H) Balances of Trade Payables and Receivables to/from various parties/authorities, and Loans & advances are subject to confirmation from the respective parties, and necessary adjustments if any, will be made on its reconciliation.

(I) In the Opinion of the Board of Directors the aggregate value of current assets, loans and advances on realization in ordinary course of business will not be less than the amount at which these are stated in the Balance Sheet.

(J) Significant Events Occuring After the Balance Sheet Date

There is no significant subsequent event that would require adjustments or disclosure in the financial statements as on the balance sheet date.

(K) As the Company''s business activities fall within single primary business segment and in the opinion of the management there does not exist separate reportable geographical segment, the disclosure requirements of Accounting Standard 17 - “Segment Reporting”, issued by the Institute of Chartered Accountants of India are not applicable.

(L) The company does not have any pending litigation on its financial position in its financial statements.

(M) Previous year’s figures have been re-arranged and re-grouped, wherever necessary to make them comparable with those of current year.

(N) Additional Regulatory Disclosures As Per Schedule III Of Companies Act, 2013.

Additional Regulatory Information required for preparation of Balance Sheet as given in Companies Act, 2013.

a) The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

b) The Company has Fund-based and Non-fund-based limits of Working Capital from Banks and Financial institutions. For the said facility, the submissions made by the Company to its lead bankers based on closure of books of accounts at the year end, the quarterly returns or statements comprising stock statements, statement of trade receivables and trade payables and ageing analysis of the debtors/other receivables, and other stipulated financial information filed by the Company with such banks or financial institutions are generally in agreement with the unaudited books of account of the Company of the respective quarters and no material discrepancies have been observed.

c) The Company has not been declared as a willful defaulter by any lender who has powers to declare a company as a willful defaulter at any time during the financial year or after the end of reporting period but before the date when the financial statements are approved.

d) The Company has not entered the transaction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Company Act, 1956.

e) There is no Indian Subsidiary Companies, hence disclosure as prescribed under clause (87) of section 2 of the Companies Act 2013 read with Companies (Restrictions on number of Layers) Rules, 2017 is not applicable.

f) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities(intermediaries), with the understanding that the intermediary shall;

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

g) The Company has not received any funds from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall;

(i) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate beneficiaries) or

(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

h) The Company does not have any transactions which is not recorded in the books of accounts but has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

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

j) There is no Contingent Liabilities & Commitment as on 31.03.2024

k) No such assets held by the company for which Title deeds of Immovable Properties not held in name of the Company.

l) There is no Loans or advances granted to the Promoters, directors, KMP and the relative of their during the period.

m) Company has register all it''s charges within time or extenteded time period given in the companies act, 2013.

(P) Issue of Shares

i) Issue of Equity shares through IPO:

The Company has completed Initial Public Offer of 51,66,000 Equity Shares of the face value of Rs.10 each at an issue price of Rs.100 per Equity Share, comprising fresh issue of 51,66,000 shares aggregating to Rs. 516.60 Million. The Equity Shares of the Company were listed on 03rd November, 2023 on SME Plateform of NSE Limited.

ii) IPO Expenses:

The total IPO Expenses incurred Rs.476.59 Lakhs has been adjusted against securities premium account.

iii) Utilisation of proceeds from IPO: