Notes to Accounts of Parnax Lab Ltd.

Mar 31, 2018

Contingent assets are neither recognized nor disclosed in financial statements.

Note:

The Company intends to dispose of its certain of property, plant & equipment as it no longer intends to utilize in the next 12 months. It was previously used in its manufacturing facility at Silvassa.

An impairment loss has been recognized on reclassification of the Plant, Property & equipment as held for sale and the Company expects to realize fair value less cost to sell to be higher than carrying amount.

An active program to locate the buyer and to complete the sale has already been initiated.

(ii) Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 10 per shares. Each holder of Equity Shares is entitled to 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

Note: - the Company s pending litigations comprise of claims against the Company and proceedings pending with tax and other authorities. The Company has reviewed all its pending litigations and proceedings and has made adequate provisions, wherever required and disclosed the contingent liabilities, wherever applicable, in its financial statements. The Company does not reasonably expect the outcome of these proceedings to have a material impact on its financial statements.

35 Commitments

The Company does not have any commitments (including capital commitments) as on March 31, 2018. (As at March 31, 2017 and April 01,2016 - Nil)

38 Financial instruments

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:1.Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term maturities of these instruments.2. Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair value of such instruments is not materially different from their carrying amounts.

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

There were no significant changes in classification and no significant movements between the fair value hierarchy classifications of financial assets and financial liabilities during the period.

39 Financial risk factors

The Company''s principal financial liabilities comprise loans and borrowings, advances and trade and other payables. The purpose of these financial liabilities is to finance the Company’s operations and to provide to support its operations. The Company’s principal financial assets include loans, trade and other receivables, and cash and cash equivalents that derive directly from its operations.

The Company''s activities exposes it to Liquidity Risk, Market Risk and Credit risk. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarized as below.

(a) Liquidity risk

The risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Liquidity risk management implies maintenance sufficient cash including availability of funding through an adequate amount of committed credit facilities to meet the obligations as and when due.

The Company manages its liquidity risk by ensuring as far as possible that it will have sufficient liquidity to meet its short term and long term liabilities as and when due. Anticipated future cash flows are expected to be sufficient to meet the liquidity requirements of the Company.

(b) 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: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk includes investment, deposits, foreign currency receivables and payables. The Company''s treasury team manages the Market risk, which evaluates and exercises independent control over the entire process of market risk management.

(i) Foreign currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company has foreign currency trade payables and receivables and is therefore exposed to foreign exchange risk. The exchange rates have been volatile in the recent years and may continue to be volatile in the future. Hence the operating results and financials of the Company may be impacted due to volatility of the rupee against foreign currencies.

Notes to Standalone Financial Statements for the year ended 31st March, 2018

(ii) Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of the financial instruments will fluctuate because of changes in market interest rates. According to the Company interest rate risk exposure is only for floating rate borrowings. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates.

(c) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations. The Company is exposed to credit risks from its operating activities, primarily trade receivables, cash and cash equivalents, deposits with banks and other financial instruments. Credit risk is managed by the Company through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business. Company''s major sales are to its holding company,

Trade and other receivables

The Company considers the probability of default upon initial recognition of assets and whether there has been a significant increase in credit risks on an ongoing basis throughout each reporting period.

To assess whether there is a significant change increase in credit risk the Company compares the risks of default occurring on the assets as at the reporting date with the risk of default as at the date of initial recognition. It considers the reasonable and supportive forward looking information such as:

(i) Actual or expected significant adverse changes in business.

(ii) Actual or expected significant changes in the operating results of the counterparty

(iii) Financial or economic conditions that are expected to cause a significant change to the counterparty''s ability to meet its obligations

(iv) Significant increase in credit risk on other financial instruments of same counterparty

Movement in provisions of doubtful debts and advances - There were no Provision of doubtful debts as on March 31, 2018 and March 31, 2017

40 (a) Financial risk factors

Capital risk management

The Company''s objectives when managing capital are to :

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

(ii) maintain an optimal capital structure to reduce the cost of capital

In order to maintain or adjust the capital structure, the Company may issue new shares, adjust the amount of dividends paid to shareholders etc. The Company''s policy is to maintain a stable and strong capital structure with a focus on total equity so as to maintain investor, creditors and market confidence and to sustain future development and growth of its business. The Company will take appropriate steps in order to maintain, or if necessary adjust, its capital structure.

The Company monitors capital using a gearing ratio being a ratio of net debt as a percentage of total capital. . , ,

(b) Dividends

The Company follows the policy of Dividend for every financial year as may be decided by Board considering financial performance of the company and other internal and external factors enumerated in the Company dividend policy.

41 Segment Reporting

The Company''s Board of Directors consisting of Managing Director has been identified as the Chief Operating Decision Maker (CODM) as defined under Ind AS 108 "Operating Segments". The CODM evaluates the Company''s performance and allocated the resources based on an analysis of various performance indicators . The Company is primarily engaged in the business of Manufacture of Pharmaceuticals, Medicinal products and the management considers these business activities as a single reportable segment.

Notes to Standalone Financial Statements for the year ended 31st March, 2018

42 Related party disclosure under Ind AS 24

Name of related parties and description of relationship

(a) Subsidiary

Naxpar Pharma Pvt. Ltd.

(b) Key managerial personnel Mr. Prakash M. Shah, Director Mr. Baiju M. Shah, Director

(c) Relative of key managerial personnel Mr. Binoy B. Shah, Son of Mr. Baiju M. Shah

(d) Concern in which KMP and/or Relatives of KMP is interested M/s Nithyasha Healthcare Pvt. Ltd.

M/s. Tridente Medicamentos LLP

Notes to Standalone Financial Statements for the year ended 31st March, 2018

43 First time adoption of Ind AS

The accounting policies set out in Note 1, have been applied in preparing the financial statements from the year ended March

31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS balance sheet at April 01, 2016 (the Company''s 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, 2006 (as amended) 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 Company''s financial position, financial performance and cash flows is set out in the following tables and notes.

Exemptions and exceptions availed

A. Ind AS optional exemptions

(i) Deemed Cost

The Company on first time adoption of Ind AS, has elected to continue with the carrying value for all of its property, plant & equipment and other intangible assets as recognized 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 costs as at the date of transition.

(ii) Investments in subsidiary

The Company has opted para D14 and D15 and accordingly considered the Previous GAAP carrying amount of Investments as deemed cost as at the transition date.

(iii) Designation of previously recognized financial instruments

Paragraph D19B of Ind AS 101 gives an option to an entity to designate investments in equity instruments at FVOCI on the basis of the facts and circumstances at the date of transition to Ind AS .The company has opted to apply this exemption for its investment in equity Investments.

B. Ind AS mandatory exemptions

(i) Estimates

An entity’s estimates in accordance with Ind ASs 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).

Ind AS estimates as at April 01, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

The Company made estimates for following item in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

- Impairment of financial assets based on expected credit loss model.

(ii) Classification and measurement of financial assets

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

(iii) De-recognition of financial assets and financial liabilities

The Company has elected to apply derecognition requirements for financial assets and financial liabilities in Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS.

C. Transition to Ind AS - Reconciliations

The following reconciliations provide a quantification of the effect of significant differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

(i) Reconciliation of Balance sheet as at April 1, 2016 (Transition date)

(ii) A. Reconciliation of Balance sheet as at March 31, 2017

B. Reconciliation of total comprehensive income for the year ended March 31, 2017

(iii) Reconciliation of Equity as at April 1, 2016 and March 31, 2017

(iv) Impact on cash flow statement for the period ended March 31, 2017

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Mar 31, 2016

1. Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 10 per shares. Each holder of Equity Shares is entitled to 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

2. Term loan from State Bank of India is secured by extension of hypothecation on the current assets of the company and mortgage of immovable & movable assets of the company.

3. Term loan from Maratha Sahakari Bank Ltd. is secured by way of mortgage of office premises of the company

4. Vehicle loans from HDFC Bank Ltd. & ICICI Bank Ltd are secured against hypothecation of respective vehicle

5. Repayment Profile of Term Loans is as set out below:

6. CONTINGENT LIABILITY : in respect of

7. Guarantees issued by the bankers in favour of various authorities, which have been counter Guarantee by the company Rs. 24.76 Lacs (Rs. 24.76 Lacs).

8. Tax Matters

9. Disputed excise duty demand, matter under appeal Rs. 68.87 Lacs (Rs. 68.87 Lacs)

10. Disputed income tax demand, matter under appeal Rs. 59.42 Lacs( Rs. 59.42 Lacs)

11. Dues to Small Scale industrial undertakings enterprises are worked out on the basis of verbal confirmation from suppliers. As at 31st March, 2016, there were no small scale industrial undertakings to which the company owes any sum which is outstanding for more than 30 days. The information pertaining to micro and small enterprises as required to be disclosed in accordance with Section 22 of Micro, Small and Medium Enterprises Development Act, 2006 is not readily ascertainable and hence not disclosed.

11. Since the Company’s business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure has been made as specified in Accounting Standard (AS-17) "Segment Reporting".

12. The balances of Unsecured Loans, Creditors, Debtors and Loans and Advances are subject to confirmation and reconciliation, if any.

13. In the opinion of the board, the Current Assets, Loans and Advances are approximately of the value stated in the Balance Sheet, if realized in the ordinary course of business.

14. Balance of Investment in M/s Novonax LLP is subject to confirmation.

15. Previous year''s figures have been regrouped and rearranged, to correspond with the figures of current year wherever necessary. Figures in bracket represent previous year.

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Mar 31, 2015

1. BACKGROUND

Parnax Lab Limited is a public company incorporated under the provisions of the Companies Act, 1956. The Company is principally engaged in the business activities of manufacturing and export of Pharmaceutical Formulations.

2. Terms/rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs. 10 per shares. Each holder of Equity Shares is entitled to 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

3. CONTINGENT LIABILITY : in respect of

a. Guarantees issued by the bankers in favour of various authorities, which have been counter Guarantee by the company Rs. 24.76 Lacs (Rs. 24.76 Lacs).

b. Tax Matters

i. Disputed excise duty demand, matter under appeal Rs. 68.87 Lacs (Rs. 68.87 Lacs)

ii. Disputed income tax demand, matter under appeal Rs. 59.42 Lacs( Rs. 59.42 Lacs)

4. Dues to Small Scale industrial undertakings enterprises are worked out on the basis of verbal confirmation from suppliers. As at 31st March, 2015, there were no small scale industrial undertakings to which the company owes any sum which is outstanding for more than 30 days. The information pertaining to micro and small enterprises as required to be disclosed in accordance with Section 22 of Micro, Small and Medium Enterprises Development Act, 2006 is not readily ascertainable and hence not disclosed.

5. Since the Company's business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure has been made as specified in Accounting Standard (AS-17) "Segment Reporting".

6. Since the Company's business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure has been made as specified in Accounting Standard (AS-17) "Segment Reporting".

7. Related Party Disclosures

(i) Name of the related Parties and Description of relationship

Subsidiary Naxpar Pharma Pvt. Ltd.

Key Management Personnel Mr. Prakash M. Shah

Mr. Baiju M. Shah

Relatives of Key Management Personnel Mr. Mihir P Shah

Mr. Binoy B. Shah Ms. Pragna P Shah Ms. Ila B. Shah Ms. Ami M. Shah

Concern in which KMP and/or Relatives of M/s Nithyasha Healthcare KMP is interested Pvt. Ltd.

8. The balances of Unsecured Loans, Creditors, Debtors and Loans and Advances are subject to confirmation and reconciliation, if any.

9. In the opinion of the board, the Current Assets, Loans and Advances are approximately of the value stated in the Balance Sheet, if realised in the ordinary course of business.

10. Balance of Investment in M/s Novonax LLP is subject to confirmation.

11. Previous year's figures have been regrouped and rearranged, to correspond with the figures of current year wherever necessary. Figures in bracket represent previous year.

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Mar 31, 2014

1. CONTINGENT LIABILITY : in respect of

a Guarantees issued by the bankers in favour of various authorities, which have been counter Guarantee by the company Rs. 24.76 Lacs (Rs. 24.76 Lacs).

b Claims against the Company not acknowledge as debt Rs. Nil (Rs. 19.55 Lacs).

c. Dues to Small Scale industrial undertakings enterprises are worked out on the basis of verbal confirmation from suppliers. As at 31st March, 2010, there were no small scale industrial undertakings to whom the company owes any sum which is outstanding for more than 30 days. The information pertaining to micro and small enterprises as required to be disclosed in accordance with Section 22 of Micro, Small and Medium Enterprises Development Act, 2006 is not readily ascertainable and hence not disclosed.

d. A. Pursuant to Scheme of Amalgamation of Parnax Lab Private Limited and Naxpar Lab Private Limited, under section 391 to Section 394 of the Companies Act, 1956 approved by Hon''ble High Court of Bombay vide its order dated 2nd December, 2011 which became effective on 2nd January, 2012 on filling of the certified copy of the orders of the High Court in the office of the Registrar of Companies, w.e.f. 1st November, 2010, the appointed date of the Scheme:

2.i. The entire business of Parnax Lab Private Limited and Naxpar Lab Private Limited, engaged in manufacturing of Pharmaceutical Formulations, has been transferred to the Company

ii. The amalgamation has been accounted for under ''the pooling of interest method'' being an amalgamation in the nature of merger, as prescribed by the Accounting Standard - 14 "Accounting for Amalgamations" notified under Companies (Accounting Standard) Rules, 2006.

iii. In terms of the Scheme, the difference in the value of net assets and reserves of Parnax Lab Private Limited and Naxpar Lab Private Limited as at 1st November, 2010 duly adjusted for issue of shares to shareholders of Parnax Lab Private Limited and Naxpar Lab Private Limited, amounting to Rs. 3,91,51,660/- has been adjusted against Share Premium Account and General Reserve.

iv. The assets and liabilities as at 31st March, 2011 and the transaction including income and expenses for the period form 1st November, 2010 to 31st March, 2011 of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited (being the period when pending effectuation of the scheme, the business and activities if erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited were run and managed in trust for the Company) have been incorporated in the accounts on the basis of its audited financial statements under the Companies Act, 1956 for the period ended on 31st March, 2011. Consequently, Net Loss for the period amounting to Rs. 13,30,466/- (after adjustments on account of unrealised profit and tax) is included in accumulated Profit and Loss Account balance of Rs. 6,05,12,935/-, transferred on merger of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited with the Company.

3. a. Since the Company''s business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure has been made as specified in Accounting Standard (AS-17) "Segment Reporting".

b. The balances of Unsecured Loans, Creditors, Debtors and Loans and Advances are subject to confirmation and reconciliation, if any.

c. In the opinion of the board, the Current Assets, Loans and Advances are approximately of the value stated in the Balance Sheet, if realised in the ordinary course of business.

d. Balance of Investment in M/s Novonax LLP is subject to confirmation.

e. Previous year''s figures have been regrouped and rearranged, to correspond with the figures of current year wherever necessary. Figures in bracket represent previous year.

4. (i) Terms/rights attached to Equity Shares

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

a. Term loan from State Bank of India is secured by extension of hypothecation on the current assets of the company and mortgage of immovable & movable assets of the company.

b. Term loan from Maratha Sahakari Bank Ltd. is secured by way of mortgage of office premises of the company

c. Vehicle loans from HDFC Bank Ltd. & ICICI Bank Ltd are secured against hypothecation of respective vehicle

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Mar 31, 2013

A. CONTINGENT LIABILITY : in respect of

a. Guarantees issued by the bankers in favor of various authorities, which have been counter Guarantee by the company Rs. 24.76 Lacs (Rs. 24.76 Lacs).

b. Claims against the Company not acknowledge as debt 19.55 Lacs (Rs. 27.17 Lacs).

c. Dues to Small Scale industrial undertakings enterprises are worked out on the basis of verbal confirmation from suppliers. As at 31st March, 2010, there were no small scale industrial undertakings to whom the company owes any sum which is outstanding for more than 30 days. The information pertaining to micro and small enterprises as required to be disclosed in accordance with Section 22 of Micro, Small and Medium Enterprises Development Act, 2006 is not readily ascertainable and hence not disclosed.

d. A. Pursuant to Scheme of Amalgamation of Parnax Lab Private Limited and Naxpar Lab Private Limited, under section 391 to Section 394 of the Companies Act, 1956 approved by Hon''ble High Court of Bombay vide its order dated 2nd December, 2011 which became effective on 2nd January, 2012 on filling of the certified copy of the orders of the High Court in the office of the Registrar of Companies, w.e.f. 1st November, 2010, the appointed date of the Scheme:

i. The entire business of Parnax Lab Private Limited and Naxpar Lab Private Limited, engaged in manufacturing of Pharmaceutical Formulations, has been transferred to the Company

ii. The amalgamation has been accounted for under ''the pooling of interest method'' being an amalgamation in the nature of merger, as prescribed by the Accounting Standard – 14 "Accounting for Amalgamations" notified under Companies (Accounting Standard) Rules, 2006.

iii. In terms of the Scheme, the difference in the value of net assets and reserves of Parnax Lab Private Limited and Naxpar Lab Private Limited as at 1st November, 2010 duly adjusted for issue of shares to shareholders of Parnax Lab Private Limited and Naxpar Lab Private Limited, amounting to Rs. 3,91,51,660/- has been adjusted against Share Premium Account and General Reserve.

iv. The assets and liabilities as at 31st March, 2011 and the transaction including income and expenses for the period from 1st November, 2010 to 31st March, 2011 of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited (being the period when pending effectuation of the scheme, the business and activities if erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited were run and managed in trust for the Company) have been incorporated in the accounts on the basis of its audited financial statements under the Companies Act, 1956 for the period ended on 31st March, 2011. Consequently, Net Loss for the period amounting to Rs. 13,30,466/- (after adjustments on account of unrealised profit and tax) is included in accumulated Profit and Loss Account balance of Rs. 6,05,12,935/-, transferred on merger of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited with the Company.

e. Since the Company''s business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure have been made as specified in Accounting Standard (AS-17) "Segment Reporting".

f. The balances of Unsecured Loans, Creditors, Debtors and Loans and Advances are subject to confirmation and reconciliation, if any.

g. In the opinion of the board, the Current Assets, Loans and Advances are approximately of the value stated in the Balance Sheet, if realised in the ordinary course of business.

h. Balance of Investment in M/s Novonax LLP is subject to confirmation.

i. Consequent to effectuation of the Scheme of Amalgamation referred to in Note ''d'' above, previous year figures includes figures of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited.

j. Previous year''s figures have been regrouped and rearranged, to correspond with the figures of current year wherever necessary. Figures in bracket represent previous year.

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Mar 31, 2012

A. CONTINGENT LIABILITY : in respect of

a. Guarantees issued by the bankers in favour of various authorities, which have been counter Guarantee by the company Rs. 24.76 Lacs (Rs. 24.76 Lacs).

c. Dues to Small Scale industrial undertakings enterprises are worked out on the basis of verbal confirmation from suppliers. As at 31st March, 2010, there were no small scale industrial undertakings to whom the company owes any sum which is outstanding for more than 30 days. The information pertaining to micro and small enterprises as required to be disclosed in accordance with Section 22 of Micro, Small and Medium Enterprises Development Act, 2006 is not readily ascertainable and hence not disclosed.

b. A. Pursuant to Scheme of Amalgamation of Parnax Lab Private Limited and Naxpar Lab Private Limited, under section 391 to Section 394 of the Companies Act, 1956 approved by Hon'ble High Court of Bombay vide its order dated 2nd December, 2011 which became effective on 2nd January, 2012 on filling of the certified copy of the orders of the High Court in the office of the Registrar of Companies, w.e.f. 1st November, 2010, the appointed date of the Scheme:

i. The entire business of Parnax Lab Private Limited and Naxpar Lab Private Limited, engaged in manufacturing of Pharmaceutical Formulations, has been transferred to the Company

ii. The amalgamation has been accounted for under 'the pooling of interest method' being an amalgamation in the nature of merger, as prescribed by the Accounting Standard - 14 "Accounting for Amalgamations" notified under Companies (Accounting Standard) Rules, 2006.

iii. In terms of the Scheme, the difference in the value of net assets and reserves of Parnax Lab Private Limited and Naxpar Lab Private Limited as at 1st November, 2010 duly adjusted for issue of shares to shareholders of Parnax Lab Private Limited and Naxpar Lab Private Limited, amounting to Rs. 3,91,51,660/- has been adjusted against Share Premium Account and General Reserve.

iv. The assets and liabilities as at 31st March, 2011 and the transaction including income and expenses for the period form 1st November, 2010 to 31st March, 2011 of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited (being the period when pending effectuation of the scheme, the business and activities if erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited were run and managed in trust for the Company) have been incorporated in the accounts on the basis of its audited financial statements under the Companies Act, 1956 for the period ended on 31st March, 2011. Consequently, Net Loss for the period amounting to Rs. 13,30,466/- (after adjustments on account of unrealised profit and tax) is included in accumulated Profit and Loss Account balance of Rs. 6,05,12,935/-, transferred on merger of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited with the Company.

Equity shares allotted pursuant to Scheme of Merger has been considered as deemed to be allotted on appointed date and hence share issued pursuant to Scheme of Merger has been taken for calculating earning per share for the year

c. Since the Company's business activity falls within a single primary business segment and also there is no significant reportable segment, hence no disclosure have been made as specified in Accounting Standard (AS-17) "Segment Reporting".

d. The balances of Unsecured Loans, Creditors, Debtors and Loans and Advances are subject to confirmation and reconciliation, if any.

e. In the opinion of the board, the Current Assets, Loans and Advances are approximately of the value stated in the Balance Sheet, if realised in the ordinary course of business.

f. Balance of Investment in M/s Novonax LLP is subject to confirmation.

g. Consequent to effectuation of the Scheme of Amalgamation referred to in Note 'd' above, current year figures includes figures of erstwhile Parnax Lab Private Limited and Naxpar Lab Private Limited. As such the corresponding figures of the previous year are not directly comparable with those of the current year.

h. Previous year's figures have been regrouped and rearranged, to correspond with the figures of current year wherever necessary. Figures in bracket represent previous year.

Working Capital facility from State Bank of India is secured by way of Hypothecation of stocks, book debts and entire current assets of the company. The facility is further secured by second charge on fixed assets and personal guarantee of all the Directors of the company.

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Mar 31, 2004

1. The previous years figures have been regrouped, recast and or rearranged wherever necessary.

2. Other additional information pursuant to para 4C and 4D of part II of Schedule VI of The Companies Act, 1956, are not applicable.

3. The Company has received registration from RBI under Section 45 I A under RBI Act.

4. Due to non-availability of adequate documents it is not ascertainable as to how much amount is recoverable from Tax Deducted at Source amounting to Rs. 14,90,831/- which is shown under Loans & Advances.

5. The Company has converted shares of Rs. 507,207/- held as stock-in-trade into Investment as on 01.04.2003.

6. The Income Tax Department has raised Demand for various Assessment Years Aggregating to Rs.2,18,83,988/-. The Company has preferred Appeals with various Authorities/The Company does not envisage any Tax liability.