Notes to Accounts of R&B Denims Ltd.

Mar 31, 2023

** Education and skill development, healthcare, socio-economic development and any activity covered under schedule VII of Companies Act 2013.

(iv) Financial Instruments

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 - Quoted (unadjusted) prices in active market for identical assets or liabilities.

• Level 2 (if level 1 feed is not available/appropriate) - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

• Level 3 (if level 1 and 2 feed is not available/appropriate) - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

For financial assets and liabilities maturing within one year from the Balance Sheet date and which are not carried at fair value, the carrying amount approximates fair value due to the short maturity of these instruments."

#Exclude Group Company investments 22,54,27,457 (Previous Year 18,50,58,429) measured at cost

The fair value of cash and cash equivalents, trade receivables, borrowings, trade payables, other current financial assets and liabilities approximate their carrying amount largely due to the shortterm nature of these instruments. The Company''s long term debt and investment in fixed deposit have been contracted at market rates of interest. Accordingly, the carrying value of such instruments approximates their fair value.

The fair value of investment in shares of The Cosmos Co-operative Bank Ltd. has been valued using cost approach.

B. Financial Risk Management

The Company''s activities expose it to variety of financial risks: market risk, credit risk, interest rate risk and liquidity risk. Within the boundaries of approved Risk Management Policy framework The Company uses derivative instruments to manage the volatility of financial markets and minimize the adverse impact on its financial performance.

i) 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.

a) Foreign Currency Risk

Foreign currency risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee.

The Company mainly deals in USD and hedge its risk with Futures contract.

b) Interest Rate Risk

The Company is also exposed to interest rate risk, changes in interest rates will affect future cash flows or the fair values of its financial instruments, principally debt. The Company issues debt in a variety of currencies based on market opportunities and it uses derivatives to hedge interest rate exposures.

c) Credit Risk

Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the Company. Credit risk arises from company''s activities in investments, dealing in derivatives and receivables from customers. The Company ensure that sales of products are made to customers with appropriate creditworthiness. Investment and other market exposures are managed against counterparty exposure limits. Credit information is regularly shared between businesses and finance function, with a framework in place to quickly identify and respond to cases of credit deterioration.

d) Liquidity Risk

Liquidity risk arises from the Company''s inability to meet its cash flow commitments on the due date. The Company maintains sufficient stock of cash, marketable securities and committed credit facilities. The Company accesses global and local financial markets to meet its liquidity requirements. It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the Company''s cash flow position and ensures that the Company is able to meet its financial obligation at all times including contingencies.

The case of the Company stands pending before Customs Excise & Servive Tax Appellate Tribunal (CESTAT) for payment of custom duty. The amount of custom duty involved is Rs. 1,93,179/- which is contingent in nature.

The Appeal of the Company stands pending before Commissioner of Appeals (Income Tax) for F.Y. 2017-18. The amount of tax liability involved are Rs. 27,45,944 (And accrued interest Rs. 2,05,956) which is contingent in nature.

Under the scheme of Vivaad se Vishwas, form 5 have been issued by authorities and it is closed. However, the effect of Rs. 6,64,13,710/- for F.Y. 2015-16, and the effect of Rs. 89,88,832/- for F.Y. 2013-14, in the same scheme is pending to get cleared from the Income Tax Department.

(ix) Operating Segment:

Ind AS 108, Operating segments, establishes standards for the way that public business enterprises report information about operating segments and related disclosures about products and services, geographic areas, and major customers. The Chief Operating Decision Maker evaluates the Group''s performance and allocates resources based on analysis of various performance indicators by business segments. Accordingly, information has been presented along business segments. The accounting principles used in the preparation of the financial statements are consistently applied to record revenue and expenditure in individual segments, and are as set out in the accounting policies.

Revenue and identifiable operating expenses in relation to segments are categorized based on items that are individually identifiable to that segment.

The Management believes that it is not practical to provide segment disclosures relating to few costs and expenses, and accordingly these expenses are separately disclosed as "unallocated" and adjusted against the total income of the Group.

The Company has three segments. Denims manufacturing, Solar and Windmill. Operating segments are defined as components of a company for which discrete financial information is available that is evaluated regularly by Chief Operating Decision Maker ("CODM"), in deciding how to allocate resources and assessing performance.

(x) There was no employee in receipt of remuneration aggregating to Rs. 102,00,000/- or more per year or Rs 8,50,000/- or more per month for the part or whole of the year. Previous year also there was no such employee.

(xi) The quantity and value of closing stock is certified by the management as true and correct.

Dues to Micro and Small Enterprise have been determined to the extent such parties have been identified on the basis of information collected by the Management.

(xiii) Managerial remuneration paid/ payable to the Managing Director/ Directors for the period from 1st April 2022 to 31st March 2023 Rs. 30 Lacs (Previous Year Rs. 30 Lacs)

(xiv) Previous year''s figures have been regrouped / recast wherever necessary to conform to current period''s presentation.

(xx) The financial statements for the year ended March 31, 2023 were approved by the Board of Directors and authorised for issue on 10-05-2023.

(29) ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III TO THE COMPANIES ACT, 2013i. Details of Benami property held

No proceedings have been initiated on or are pending against the Company for holding Benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

ii. Borrowing secured against current assets

The Company have sanctioned borrowings/facilities from banks on the basis of security of current assets. The quarterly returns or statements of current assets filed by the Company with banks and financial institutions are in agreement with the books of accounts.

iii. Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or any lender.

iv. Relationship with struck off companies

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956. Hence, no disclosure require in this clause.

v. Compliance with number of layers of companies

The Company have only one Subsidiary Enterprise i.e RB Industries and the company do not have layers of subsidiaries beyond the prescribed number with respect to the

Companies (Restriction on number of layers) Rules, 2017.The Company has complied with the number of layers prescribed under the Companies Act, 2013.

vi. Compliance with approved scheme(s) of arrangements

The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

vii. Utilisation of borrowed funds and share premium

i. 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:

a) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

ii. The Company has not received any fund 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:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries

viii. Undisclosed Income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

ix. Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the year.

x. Valuation of PP&E, intangible asset and investment property

The Company has not revalued its property, plant and equipment (including right-of-use assets) during the current or previous year.

The Title deeds of immovable properties are held in the name of the Company.

The Company has no Intangible assets under development as on 31.03.2023.

xi. Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

xii. Loans to Promoters, directors, KMPs and Related parties

There are no Loans or Advances in the nature of loans are granted to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013,) either severally or jointly with any other person.

(30) Figures for previous year have been regrouped wherever considered necessary.

c) Explanation for Change in the Ratio by more than 25% as compared to previous year:

#Decrease in CC Utilisation by huge amount is the reason for increase in Current Ratio.

@Repayment of Debt and Simultaneous increase in Shareholder''s equity lead to decrease in Debt/Equity ratio.

* Decrease in profitability in F.Y. 2022-23 and Simultaneous increase in Shareholder''s equity lead to decrease in the ratio.

** Revenue of the company has decreased and there in increase in finished stock and as a result Inventory Turnover Ratio has decreased.

$-Increase in Repo rate and FD rates lead to increase in ROI.

Term Loan(s) from The Cosmos Co-op Bank Ltd are secured by way of:

a) Hypothecation of existing plant and machineries.

b) Factory Land (lease hold), along with construction thereon made by the company, situated at Revenue Survey 446, Block No. 467, at Sachin-Palsana Highway Road, at Village Palsana, Dist. Surat, given as collateral security.

c) Personal gaurantee by the Directors - Mr. Amitkumar Dalmia, Mr. Deepakkumar Dalmia, Mr. Rajkumar Borana and Mr. Ankur Borana.

Term Loan(s) from Kotak Mahindra Bank Ltd are secured by way of:

a) Offering Collateral Security in the form of registered mortage of Residential Plot in the name of Director and his Spouse & also personal guarantee of the Director namely Mr. Amitkumar Dalmia, Mr. Deepak Dalmia, Mr. Rajkumar Borana & Mr. Ankur Borana.

** Cash Credit facility

From The Cosmos Co-op Bank Ltd & Axis Bank Ltd are secured by,

a) charge on all Current Assets of the Company & Pari Passu charges on the Facory Land & Building, in the name of Director''s of the Company namely Mr. Amitkumar Dalmia, Mr. Deepak Dalmia, Mr. Rajkumar Borana & Mr. Ankur Borana and also their respective Personal Guarantee.

Current maturities of term loans amounting to Rs. 716.15 on March 31, 2023 (Rs. 672.42 on March 31, 2022 March 31, 2021 and March 31, 2020 Rs 739.12 and 199.8 respectively) is classified under "Other Current Financial Liabilities".

The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the projected beneft obligation as recognised in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

Risks associated with defined benefit plan

Salary Risk: The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan''s liability.

Interest rate risk: A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher provision.

Asset Liability Matching Risk: The plan faces the ALM risk as to the matching cash flow. Company has to manage pay- out based on pay as you go basis from own funds.

Mortality risk: Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

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Mar 31, 2018

1) THE COMPANY OVERVIEW:

R & B Denims Ltd. is a Public Limited Listed Company incorporated and domiciled in India. The address of its registered office is R & B Denims Limited, Block No. 467, Palsana-Sachin Highway, Gujarat, India. The Company is engaged in the business of manufacturing and sale of quality Denim Textile products. The company caters both domestic and international markets.

2) BASIS OF PREPARATION OF FINANCIAL STATEMENTS:

Statement of compliance and basis of preparation

These financial statements are prepared in accordance with Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules as amended from time to time, the provisions of the Companies Act, 2013 (“the Companies Act”) as applicable and guidelines issued by the Securities and Exchange Board of India (“SEBI”).

Up to the year ended March 31, 2017, the company prepared its financial statements in accordance with the requirements of the Indian GAAP (“Previous GAAP”), which included Standards notified under the Companies (Accounting Standards) Rules, 2006. The date of transition to Ind AS is April 01, 2016.

Accounting policies have been applied consistently to all periods presented in these financial statements.

The financial statements correspond to the classification provisions contained in Ind AS 1 “Presentation of Financial Statements”. For clarity, various items are aggregated in the statements of profit and loss and balance sheet. These items are disaggregated separately in the notes to the financial statements, where applicable.

All amounts included in the financial statements are reported in lakhs of Indian rupees except share and per share data, unless otherwise stated. Due to rounding off, the numbers presented throughout the document may not add up precisely to the totals and percentages may not precisely reflect the absolute figures.

Basis of measurement

These financial statements have been prepared on a historical cost convention and on an accrual basis, except for the following material items which have been measured at fair value as required by relevant Ind AS;

- The defined benefit asset(liability) is as the present value of defined benefit obligation less fair value of plan assets and

- Financial instruments classified as fair value through profit or loss.

Use of estimates and judgment

The preparation of the financial statements in accordance with Ind AS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from those estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. In particular, information about significant areas of estimation, uncertainty and critical judgment in applying accounting policies that have the most significant effect on the amounts recognized in financial statements are included in the following notes:

- Useful lives of Property, plant and equipment [Note M]

- Measurement of defined benefit obligations [Note D]

- Provision for inventories [Note J]

- Measurement and likelihood of occurrence of provisions and contingencies [Note Q]

- Deferred taxes [Note E]

3) RECENT ACCOUNTING DEVELOPMENTS

Standards issued but not yet effective:

In March 2018, the Ministry of Corporate Affairs issued the Companies (Indian Accounting Standards) (Amendment) Rules, 2018, issuing Ind AS 115, Revenue from Contracts with Customers. The standard is applicable from April 01, 2018. The Corresponding Ind AS 18, ‘Revenue’ and Ind AS 11, ‘Construction Contract’ have been omitted. Relevant amendments have been made to Ind AS 101, 103, 104, 107, 109, 112, 1, 2, 8, 12, 16, 17, 21, 23, 28, 32, 34, 36, 37, 38 and 40.

The Company has not applied these amendments since they are effective for periods beginning on or after April 01, 2018.

4) FIRST TIME ADOPTION OF IND AS

These are the Company’s first financial statements prepared in accordance with Ind AS.

The Company has adopted Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs with effect from April 01, 2017 with a transition date of April 1, 2016. These financial statements for the year ended March 31, 2018 are the first the Company has prepared under Ind AS. For all period’s upto and including the year ended 31st March, 2017, the Company prepared its financial statements in accordance with the previously applicable Indian GAAP (previous GAAP).

The adoption of Ind AS has been carried out in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards Ind AS 101 requires that all Ind AS standards and interpretations that are issued and effective for the first Ind AS financial statements be applied retrospectively and consistently for all financial years presented. Accordingly, the Company has prepared financial statements which comply with Ind AS for year ended 31st March 2018, together with the comparative information as at and for the year ended 31st March 2017. The Company’s opening Ind AS Balance Sheet has been prepared as at 1st April, 2016, the date of transition to Ind AS.

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.

An explanation of how the transition from previous GAAP to Ind AS has affected the Company financial position, financial performance and cash flows is set out in the following tables and notes

I. Optional Exemptions from retrospective application

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.

(a). Deemed cost of property, plant and equipment.

Ind AS 101 permits a first time adopter to elect to continue with the carrying values for all of its Property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for decommissioning liabilities. Accordingly, the Company has opted to consider the carrying value for all of its Property, plant and equipments as recognised in its previous GAAP financials as its deemed cost at the transition date.

(b) Fair value of financial assets and financial liabilities

Ind AS 101 permits a first time adopter to apply requirement of Ind AS 109 prospectively to transactions entered into on or after the date of transition. Accordingly the company has opted to consider the measurement of financial assets and liabilities arisen before the date of transition of Ind AS as per previous GAAP.

II. Mandatory Exceptions to retrospective application

(a). Estimates

An entity’s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies).

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 01, 2016, the date of transition to Ind AS and as of March 31, 2017.

(b). Classification and measurement of financial assets

The classification of financial assets to be measured at cost or fair value made on the basis of the facts and circumstances that existed on the date of transition to Ind AS.

III. Transition to Ind AS - Reconciliations

The following reconciliations provide the explanations and quantification of the differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101:

i. Reconciliation of Statement of Profit and Loss for the year ended 31st March, 2017.

ii. Adjustments to Statement of Cash Flows for the year ended 31st March, 2017.

Previous GAAP figures have been reclassified/regrouped wherever necessary to conform to Standalone financial statements prepared under Ind AS.

Notes to reconciliation

1) Re-measurement of defined benefit obligations :

Under the Previous GAAP, actuarial gains and losses on defined benefit obligations were recognized in the statement of profit and loss. Under Ind AS, these are recognized in other comprehensive income. This difference has resulted in an increase in net income for the year ended March 31, 2016. However, the same does not result in difference in equity or total comprehensive income.

2) Difference in current tax expense :

Tax adjustments include deferred tax impact on account of differences between Previous GAAP and Ind AS.

Trade receivables are due neither from directors or other officers of the company either severally or jointly neither with any other person nor from firms or private companies respectively in whom any director is a partner, a director or a member.

*These deposits can be withdrawn by the Company at any time without prior notice and without any penalty on the principal.

*Term loan(s) from Cosmos Co-Op Bank Limited are secured by way of:

a) Hypothecation of existing plant and machineries.

b) Factory Land (lease hold), along with construction thereon made by the company, situated at Revenue Survey 446, Block No. 467, at Sachin-Palsana Highway Road, at Village Palsana, Dist. Surat, given as collateral security.

c) Personal guarantee by the Directors - Mr. Amitkumar Dalmia, Mr. Deepakkumar Dalmia, Mr. Rajkumar Borana and Mr. Ankur Borana.

Current maturities of term loans amounting to Rs. 824.92 (March 31, 2017 and April 01, 2016: Rs 824.92 and Rs 521.67 respectively are classified under “Other Current Financial Liabilities”.

Provision for employee benefits includes gratuity liability. Provision for other taxes includes liability related to Income tax and Indirect Taxes. The timing of cash outflows in respect of other provisions cannot be reasonably determined.

(c) Defined benefit plans - Gratuity:

The Company has a defined benefit gratuity plan in India (unfunded). The company’s defined benefit gratuity plan is a final salary plan for employees.

Gratuity is paid from company as and when it becomes due and is paid as per company scheme for Gratuity.

During the year, the company has changed the benefit scheme in line with Payment of Gratuity Act, 1972 by increasing monetary ceiling from 10 lakhs to 20 lakhs. Change in liability (if any) due to this scheme change is recognised as past service cost.

The Company’s obligation in respect of the gratuity plan is provided for based on actuarial valuation using the projected unit credit method. The Company recognizes actuarial gains and losses immediately in other comprehensive income, net of taxes. Amount recognized in the statement of profit and loss in respect of gratuity cost (defined benefit plan) is as follows:

Gratuity is applicable only to employees drawing a salary in Indian rupees and there are no other foreign defined benefit gratuity plans.

The principal assumptions used for the purpose of actuarial valuation are as follows:

The discount rate is based on the prevailing market yields of Indian government securities for the estimated term of the obligations. The estimates of future salary increases considered takes into account the inflation, seniority, promotion and other relevant factors. Salary escalation and attrition rate are considered as advised by the the company; they appear to be line with the industry practice considering promotion and demand & supply of the employees.

The sensitivity analysis have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual change in the projected benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the projected benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same method as applied in calculating the projected benefit obligation as recognised in the balance sheet.

There was no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

Risks associated with defined benefit plan

Gratuity is a defined benefit plan and company is exposed to the Following Risks:

Salary Risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the members more than assumed level will increase the plan’s liability.

Interest rate risk:

A fall in the discount rate which is linked to the G.Sec. Rate will increase the present value of the liability requiring higher provision.

Asset Liability Matching Risk:

The plan faces the ALM risk as to the matching cash flow. Company has to manage pay- out based on pay as you go basis from own funds.

Mortality risk:

Since the benefits under the plan is not payable for life time and payable till retirement age only, plan does not have any longevity risk.

Note 5 Fair Value

The fair value of cash and cash equivalents, trade receivables, borrowings, trade payables, other current financial assets and liabilities approximate their carrying amount largely due to the short-term nature of these instruments. The Company’s long term debt and investment in fixed deposit have been contracted at market rates of interest. Accordingly, the carrying value of such instruments approximates their fair value.

The fair value of investment in shares of The Cosmos Co-operative Bank Ltd. has been valued using cost approach.

The case of the Company stands pending before Customs Excise & Service Tax Appellate Tribunal (CESTAT) for payment of custom duty. The amount of custom duty involved is Rs. 193,179/- which is contingent in nature.

The case of the Company stands pending before Appellate Tribunal for the Sales Tax Penalty levied for F.Y. 2012-13. The amount of Penalty is Rs. 57,074/- which is contingent in nature.

The Appeal of the Company stands pending before Commissioner of Appeals (Income Tax) for F.Y. 201213 and F.Y. 2013-14. The amount of tax liability involved are Rs. 7,335,180/- and Rs. 18,825,700/respectively which are contingent in nature.

Note 6 Operating Lease

Future lease commitments in respect of non-cancellable leases:

Note 7 Operating Segment

The operations of the company are limited to one segment viz. Denims manufacturing.

Operating segments are defined as components of a company for which discrete financial information is available that is evaluated regularly by Chief Operating Decision Maker (“CODM”), in deciding how to allocate resources and assessing performance.

Geographical revenues are allocated based on the location of the customer. Information regarding geographical revenue is as follows:

The following customers represent 10% or more of the company’s total revenue during the year ended March 31, 2018 and March 31, 2017

Note 8 Other Additional Information

There was no employee in receipt of remuneration aggregating to Rs. 10,200,000/- or more per year or Rs. 850,000/- or more per month for the part or whole of the year. Previous year also there was no such employee.

Balances of loans, advances, Cash & Bank and Creditors & Debtors are subject to confirmation and have been taken as appeared in the books of account of the company.

The quantity and value of closing stock is certified by the management as true and correct.

In the absence of information regarding outstanding dues of MICRO or Small Scale Industrial Enterprise(s) as per The Micro, Small & Medium Enterprise Development Act, the Company has not disclosed the same as required by Schedule III to the Companies Act, 2013.

The provision of Service Tax Expense has been made in current Year is Nil. (Pre Year Rs. 279,736)

The Company is eligible for VAT subsidy under the Gujarat Textile Policy 2012 amounting to Rs. 2.3 Cr, out of which subsidy of Rs. 1.05 Cr has been received and Rs. 1.25 Cr is receivable and the same have been accounted as income during the year.

The Company is eligible for Power Tariff Subsidy under the Gujarat Textile Policy 2012 amounting to Rs. 35.62 Lacs. The same have been accounted as income during the year.

The Company is eligible for Interest Subsidy under the Technology Up-gradation Fund (TUF Scheme) amounting to Rs. 56.02 Lacs. The same have been accounted as income during the year.

Managerial remuneration paid/ payable to the Managing Director/ Directors for the period from 1st April 2017 to 31st March 2018 Rs. 30 Lacs (Previous Year Rs. 30 Lacs)

(ii) Terms and rights attached to equity shares:

The company has only one class of equity shares having face value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholder.

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Mar 31, 2017

1. The case of the Company stands pending before Customs Excise & Service Tax Appellate Tribunal (CESTAT) for payment of custom duty. The amount of custom duty involved is Rs. 193,179/- which is contingent in nature.

2. The case of the Company stands pending before Appellate Tribunal for the Sales Tax Penalty levied for F.Y. 2012-13. The amount of Penalty is Rs. 57,074/- which is contingent in nature.

3. The Appeal of the Company stands pending before Commissioner of Appeals (Income Tax) for F.Y. 2012-13 and F.Y. 2013-14. The amount of tax liability involved are Rs. 7,335,180/- and Rs. 18,825,700/- respectively which are contingent in nature

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Mar 31, 2016

Note 1. The weighted average number of equity shares outstanding at the year ended on 31st march 2016, are also adjusted for the yearend balance of share application money pending allotment, as considered potential equity shares, for calculation of Diluted Earnings per Share as per the AS 20.

2. There was no employee in receipt of remuneration aggregating to Rs. 6,000,000/- or more per year or Rs. 500,000/- or more per month for the part or whole of the year. Previous year also there was no such employee.

3. Balances of loans, advances, Cash & Bank and Creditors & Debtors are subject to confirmation and have been taken as appeared in the books of account of the company.

4. The quantity and value of closing stock is certified by the management as true and correct.

5. In the absence of information regarding outstanding dues of MICRO or Small Scale Industrial Enterprise(s) as per The Micro, Small & Medium Enterprise Development Act, the Company has not disclosed the same as required by Schedule VI to the Companies Act, 1956.

6. The provision of Service Tax Expense has been made in current of Rs. 265,497 ( Pre Year Rs. 348,989)

7. The Company, being eligible for VAT subsidy under the Gujarat Textile Policy 2012, has received subsidy amount Rs. 2.05 Cr for the F.Y. 2013-14, along with interest and the same has been accounted as income during the year. Treatment of revenue recognition has been made as per AS 9.

8. The Company, being eligible for Power Tariff Subsidy under the Gujarat Textile Policy 2012, has received subsidy for the calendar year 2015, amount for Rs. 69.51 lakhs and the same has been accounted as income during the year. Treatment of revenue recognition has been made as per AS 9.

9. The Company, being eligible for Interest Subsidy under the Technology Up gradation Fund (TUF Scheme) has received subsidy for the F.Y. 2014-15, amount for Rs. 59.00 lakhs and the same has been accounted as income during the year. Treatment of revenue recognition has been made as per AS 9.

10. The Promoter Directors and the related parties made an Open Offer to the shareholders of the Company for acquisition of 3,638,619 equity shares of the company at a price of Rs. 10/- each. The offer commenced on 22.01.2016 and tendering period closed on 05.02.2016. The open offer was complete and successful within the given dates.

11. Additional information :

a. Managerial remuneration paid/ payable to the Managing Director/ Directors for the period from 1st April 2015 to 31st March 2016 Rs. 1200 thousand (Previous Year Rs. 1200 thousand )

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Mar 31, 2015

1. There was no employee in receipt of remuneration aggregating to Rs. 60,00,000/- or more per year or Rs. 5,00,000/- or more per month for the part or whole of the year. Previous year also there was no such employee.

2. Balances of loans, advances, Cash & Bank and Creditors & Debtors are subject to confirmation and have been taken as appeared in the books of account of the company.

3. The quantity and value of closing stock is certified by the management as true and correct.

4. The quantity and value of closing stock is certified by the management as true and correct.

5. The Company has made registration under Service Tax Statute in current financial year i.e. F.Y. 2013-14. Hence the provision of Service Tax Expense has been made in current of Rs. 3,48,989 ( Pre Year Rs. 1,34,748).

6. Contingent Liability

(Rs. In Thousand)

Particulars Amount in Rs. Date of Expiry of Gaurantee

1) Guarantees in lieu of Deposit

Dakshin Gujarat Vij Company Limited, Surat 4,770.88 27/08/2016

Particulars Amount in Rs. Date of Expiry of Gaurantee 2) Performance Guarantee

Director of Foreign Trade, New Delhi 703.00 17/11/2016

Director of Foreign Trade, New Delhi 63.00 22/02/2015

Commissioner of Customs, Nhava Seva, Mumbai 13,350.00 12/07/2021

Director of Foreign Trade, New Delhi 1,272.00 21/04/2016

Director of Foreign Trade, New Delhi 280.00 25/02/2016

Commissioner of Customs, Nhava Seva, Mumbai 300.00 13/12/2021

Director of Foreign Trade, New Delhi 1,900.00 10/06/2023

Director of Foreign Trade, New Delhi 107.00 12/06/2016

Director of Foreign Trade, New Delhi 830.00 21/06/2023

Director of Foreign Trade, New Delhi 20.00 30/06/2016

Director of Foreign Trade, New Delhi 25.00 30/08/2017

Director of Foreign Trade, New Delhi 768.00 27/11/2017

Commissioner of Customs, Nhava Seva, Mumbai 50.00 08/10/2014

7. The case of Company stands pending before Deputy Commissioner of Customs, Custom Division, Surat for payment of custom duty. The amount of custom duty involved is Rs. 1,93,179/-, against which duty of Rs. 14,488 is already paid. However, no provision for the liability of remaining amount of duty has been made being contigent in nature.

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Mar 31, 2014

NOTE # 1

R&B Denims is a Limited Company incorporated in November 2010 by the RawatKhedia and the Borana group, two amongst the most influential textile houses in the polyester hub at Surat. Both of these companies have a long lineage of more than 30 years each, in the textile industry, and are very well known in their areas of expertise. The commercial production of the Company had been started in financial year 2012-13.

The Company is engaged in to the business of manufacturing and sale of quality Denim Textile Products. Today the Company is manufacturing various types of Denim ranging from 9 to 14 Oz/Sq. yd. with Open End Spun Yarns, Multi Count, Cottons and Polyester Spandex with Indigo Bottom Sulphur Toppings and Sulphar Bottom and Indigo Toppings with both Foam and Wet Finishes.

(a) Contingent Liability

(Rs. In Thousand) Amount in Date of Particulars Rs. Expiry of Gaurantee

1) Guarantees in lieu of Deposit

Dakshin Gujarat Vij Company Limited, Surat 4,770.88 27/08/2016

Dakshin Gujarat Vij Company Limited, Surat 4,549.12 21/03/2015

2) Performance Guarantee

Director of Foreign Trade, New Delhi 703.00 17/11/2014

Director of Foreign Trade, New Delhi 63.00 22/02/2015

Commissioner of Customs, Nhava Seva, Mumbai 13,350.00 12/07/2021

Director of Foreign Trade, New Delhi 1,272.00 21/04/2016

Director of Foreign Trade, New Delhi 280.00 25/02/2016

Commissioner of Customs, Nhava Seva, Mumbai 300.00 13/12/2021

Director of Foreign Trade, New Delhi 1,900.00 10/06/2023

Director of Foreign Trade, New Delhi 107.00 12/06/2016

Director of Foreign Trade, New Delhi 830.00 21/06/2023

Director of Foreign Trade, New Delhi 20.00 30/06/2016

Our Company and officers in default have filled applications u/s. 621 (a) of Companies Act, 1956 for compounding of offence u/s. 295 (Loans to Directors) & u/s. 211 (Employee Benefit) of Companies Act, 1956. However, no provision for the liability being of contigent nature have been made.