Notes to Accounts of Rnit AI Solutions Ltd.

Mar 31, 2025

g. Provision and contingent liabilities

A provision is recognized if, as a result of a past event, the Company has
a present legal or constructive obligation that is reasonably estimate, and
it is probable that an outflow of economic benefits will be required to settle
the obligation. If the effect of 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. The unwinding of the discount is
recognized as finance cost.

A provision for onerous contracts is measured at the present value of the
lower of the expected cost of terminating the contract and the expected net
cost of continuing with the contract, which is determined based on the
incremental costs of fulfilling the obligation under the contract and an
allocation of other costs directly related to fulfilling the contract. Before a
provision is established, the Company recognizes any impairment loss on
the assets associated with that contract.

Provisions for warranty-related costs are recognized when the product is
sold to the customer. Initial recognition is based on management estimate
of product failure rates. The initial estimate of warranty-related costs is
revised annually.

A contingent liability is a possible obligation that arises from past events
whose existence will be confirmed by the occurrence or nonoccurrence of
one or more uncertain future events beyond the control of the Company
or a present obligation that is not recognized because it is not probable
that an outflow of resources will be required to settle the obligation. A
contingent liability also arises in extremely rare cases where there is a
liability that cannot be recognized because it cannot be measured reliably.

Contingent assets are not recognized or disclosed in these financial
statements since this may result in the recognition of income that may
never be realized.

h. financial instrument

I. Classification:

Financial assets and liabilities are recognised when the Company becomes
a party to the contractual provisions of the instrument. Financial assets

and liabilities are initially measured at fair value. Transaction costs that
are directly attributable to the acquisition or issue of financial assets and
financial liabilities (other than financial assets and financial liabilities at
fair value through profit or loss) are added to or deducted from the fair
value measured on initial recognition of financial asset or financial
liability. Financial liabilities are measured at amortised cost using the
effective interest method.

The Company derecognises a financial asset only when the contractual
rights to the cash flows from the asset expire, or when it transfers the
financial asset and substantially all the risks and rewards of ownership of
the asset to another entity. The Company derecognises financial liabilities
when, and only when, the Company’s obligations are discharged, cancelled
or have expired.

II. Initial recognition:

All financial assets are recognised initially at fair value plus, in the case of
financial assets not recorded at fair value through profit or loss,
transaction costs that are attributable to the acquisition of the financial
asset.

III. Measurement:

Financial assets carried at amortized cost:

A financial asset is subsequently measured at amortized cost if it is held
within a business model whose objective is to hold the asset in order to
collect contractual cash flows and the contractual terms of the financial
asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.

Financial assets at fair value through other comprehensive income
(FVTOCI):

A financial asset is subsequently measured at fair value through other
comprehensive income if it is held within a business model whose objective
is achieved by both collecting contractual cash flows and selling financial
assets and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding. Further, in cases where the
Company has made an irrevocable election based on its business model,
for its investments which are classified as equity instruments, the
subsequent changes in fair value are recognized in other comprehensive
income. Financial assets at fair value through profit or loss (FVTPL): A
financial asset which is not classified in any of the above categories are
subsequently fair valued through profit or loss.

IV. Impairment of financial assets (other than at fair value):

The Company assesses at each reporting date whether a financial asset or
a group of financial assets and contract assets (unbilled revenue) is
impaired. The Company recognizes loss allowances, in accordance with
IND AS 109, using the expected credit loss (ECL) model for the financial
assets which are not fair valued through profit or loss. Loss allowance for
trade receivables and unbilled revenue with no significant financing
component is measured at an amount equal to lifetime ECL. For all other
financial assets, expected credit losses are measured at an amount equal
to the 12-month ECL, unless there has been a significant increase in credit
risk from initial recognition in which case those are measured at lifetime
ECL. The amount of expected credit losses (or reversal) that is required to
adjust the loss allowance at the reporting date is recognized as an
impairment gain or loss in the statement of profit or loss.

V. Offsetting financial instruments:

Financial assets and liabilities are offset and the net amount is reported
in the balance sheet where there is a legally enforceable right to offset the
recognized amounts and there is an intention to settle on a net basis or
realize the asset on a net basis or realize the asset and settle the liability
simultaneously. The legally enforceable right must not be contingent on
future events and must be enforceable in the normal course of business
and in the event of default, insolvency or bankruptcy of the Company or
the counterparty.

i. Employee Benefits:

I. Post-employment and pension plans:

The Company participates in various employee benefit plans. Pensions
and other post-employment benefits are classified as either defined
contribution plans or defined benefit plans. Under a defined contribution
plan, the Company’s only obligation is to pay a fixed amount with no

obligation to pay further contributions if the fund does not hold sufficient
assets to pay all employee benefits. The related actuarial and investment
risks fall on the employee. The expenditure for defined contribution plans
is recognized as an expense during the period when the employee provides
service. Under a defined benefit plan, it is the Company’s obligation to
provide agreed benefits to the employees. The related actuarial and
investment risks fall on the Company. The present value of the defined
benefit obligations is calculated by an independent actuary using the
projected unit credit method.

II. Short-term benefits:

Short-term employee benefit obligations are measured on an
undiscounted basis and are recorded as expense as the related services
are provided. Liabilities for wages and salaries including the amount
expected to be paid under short-term cash bonus or profit sharing plans,
expected to be settled wholly within 12 months after the end of the period
in which the employees render the related service are recognized if the
Company has a present legal or constructive obligation to pay this amount
as a result of past service provided by the employee and the obligation can
be estimated reliably.

III. Compensated absences:

The employees of the company are entitled to compensated absences. The
employees can carry forward a portion of the unutilized accumulating
compensated absences and utilize it in future periods or receive cash at
retirement or termination of employment. The company records an
obligation for compensated absences in the period in which the employee
renders the services that increases this entitlement.

The company’s liability is actuarially determined (using the Projected Unit
Credit method) at the end of each year as applicable. Actuarial losses/
gains are recognized in the Statement of Profit and Loss in the year in
which they arise.

Accumulated compensated absences, which are expected to be availed or
encashed within 12 months from the end of the year are classified under
current liabilities and balance under non-current liabilities.

IV. Share- based payment transactions

The cost of equity-settled transactions is determined by the fair value at
the date when the grants are made using a Black Scholes model. The cost
is recognised in employee benefits expense, together with a corresponding
increase in share options outstanding account in equity, over the period
in which the performance and/or service conditions are fulfilled in a
gradual vesting manner. The amount recognised as expense is based on
the estimate of the number of awards for which the related service is
expected to be met, such that the amount ultimately recognised as an
expense is based on the number of awards that do meet the related service
conditions at the vesting date.

j. Taxes

Taxation on profit and loss comprises current tax and deferred tax. Tax is
recognized in the Statement of profit and loss except to the extent that it
relates to items recognized directly in equity or other comprehensive
income in which case tax impact is also recognized in equity or other
comprehensive income.

Current tax is provided at amounts expected to be paid (or recovered)
using the tax rates and laws that have been enacted at the balance sheet
date along with any adjustment relating to tax payable in previous years.

Deferred income tax is provided in full, using the liability method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements. Deferred
income tax is provided at amounts.

Expected to is paid (or recovered) using the tax rates and laws that have
been enacted or substantively enacted at the balance sheet date and are
expected to apply when the related deferred income tax asset is realized or
the deferred income tax liability is settled.

Deferred tax assets and deferred tax liabilities are offset when there is a
legally enforceable right to set off assets against liabilities representing
current tax and where the deferred tax assets and the deferred tax
liabilities relate to taxes on income levied by the same governing taxation
laws.

k. Earnings per share

Basic earnings per share are computed using the weighted average
number of ordinary shares outstanding during the period. Diluted
earnings per share is computed by considering the impact of the potential
issuance of ordinary shares, on the weighted average number of shares
outstanding during the period except where the results would be anti¬
dilutive.

l. Cash and cash equivalents:

As per the policy of the company Cash and cash equivalents include cash
in hand, deposits held at call with banks, other short term highly liquid
investments which are readily convertible into known amounts of cash
and are subject to insignificant risk of changes in value. Bank overdrafts
are shown within borrowings in current liabilities on the balance sheet.

Deposits held with banks as security for overdraft facilities are included
in restricted deposits held with bank. The company does not have any
borrowings or overdraft from banks or financial institutions.

m. Business combinations

Business combinations have been accounted for using the acquisition
method under the provisions of Ind AS 103, Business Combinations. The
purchase price in an acquisition is measured at the fair value of the assets
transferred, equity instruments issued and liabilities incurred or assumed
at the date of acquisition, which is the date on which control is transferred
to the Group. The purchase price also includes the fair value of any
contingent consideration. Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business combination are measured
initially at their fair value on the date of acquisition. Contingent
consideration is remeasured at fair value at each reporting date and
changes in the fair value of the contingent consideration are recognized in
the Statement of Profit and Loss.

The interest of non-controlling shareholders is initially measured either at
fair value or at the non-controlling interests’ proportionate share of the
acquiree’s identifiable net assets. The choice of measurement basis is
made on an acquisition-by acquisition basis. Subsequent to acquisition,
the carrying amount of non-controlling interests is the amount of those

interests at initial recognition plus the non-controlling interests’ share of
subsequent changes in equity of subsidiaries.

Business combinations between entities under common control is
accounted for at carrying value of the assets and liabilities in the Group’s
Consolidated financial statements. The payments related to options issued
by the Group over the non-controlling interests in its subsidiaries are
accounted as financial liabilities and initially recognized at the estimated
present value of gross obligations. Such options are subsequently
measured at fair value in order to reflect the amount payable under the
option at the date at which it becomes exercisable. In the event that the
option expires unexercised, the liability is derecognized.

Transaction costs that the Group incurs in connection with a business
combination such as finder’s fees, legal fees, due diligence fees, and other
professional and consulting fees are expensed as incurred.

n. Goodwill

Goodwill on acquisitions might be arised is recognized in the financial
statement. Goodwill is not amortised but it is tested for impairment
annually, or more frequently if events or changes in circumstances
indicate that it might be impaired, and is carried at cost less accumulated
impairment losses. Gains and losses on the disposal of an entity include
the carrying amount of goodwill relating to the entity sold.

o. Significant accounting judgments, estimates and assumptions:

The preparation of the financial statements requires management to make
judgments, estimates and assumptions that affect the reported amounts
and disclosures. The company based its assumptions and estimates on
parameters available when the financial statements were prepared and
reviewed at each balance sheet date. Uncertainty about these assumptions
and estimates could result in outcomes that may require a material
adjustment to the reported amounts and disclosures.

Fair value hierarchy

The section explains the judgement and estimates made in determining
the fair value of the financial instruments that are:

a) recognised and measured at fair value.

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

To provide an indication about the reliability of the inputs used in
determining fair value, the Company has classified its financial
instruments into three levels as mentioned under Indian accounting
standards.

Level1-Quoted prices(unadjusted) in active markets for identical assets or
liabilities. This category consists of quoted equity share, quoted debt
instruments and mutual fund investments. The fair values of investments
in units of mutual fund are based on the Net Asset Value (NAV) as per the
fund statement;

Level2- The fair value of financial instruments that are not traded in an
active market is determined using valuation techniques which maximize
the use of observable market date and rely as little as possible on entity-
specific estimates. If all significant inputs required to fair value an
instrument are observable, the instrument is included in level 2.

Level3- Inputs for the assets or liabilities that are not based on observable
market data (Unobservable inputs).

Financial assets:

The Company has not disclosed the fair values of cash and cash
equivalents including other bank balances, trade receivables and other
financial assets because their carrying amounts are a reasonable
approximation of their fair value.

Financial liabilities:

Borrowings:

It includes Vehicle loan, bank overdraft (current and non-current
borrowings). Current and non-current borrowings are measured at
amortised cost.

The carrying amounts of the current and non current borrowings would
be a reasonable approximation of their fair value.

Trade Payables and Other financial liabilities:

The company has not disclosed the fair values of trade payables and other
financial liabilities because their carrying amounts are a reasonable
approximation of their fair value.

B. Measurement of fair values

The following methods and assumption were used to estimate the fair
values:

The carrying amount of trade payables, trade receivables, current
borrowings, other financial liabilities and other financial assets (current),
measured at cost in the restated financial statements, are considered to
be the same as their fair values, due to their short term nature.

Financial risk management

The company activities expose it to a variety of financial risks, market
risks, credit risks and liquidity risks.

Risk management framework

The company''s Board of Directors have overall responsibility for the
establishment and oversight of the company''s risk management
framework. The company''s risk management policies are established to
identify and analyse the risks activities. The company, through its training
and management standards and procedures, aims to maintain a
disciplined and constructive control environment in which all employees
understand their roles and responsibilities.

C. Credit risk

Credit risk is managed by the company 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.

Financial assets that are neither past due nor impaired. Cash and cash
equivalents, trade receivables (other than those carried at cost) and other
bank balances are neither past due nor impaired.

Financial assets that are not past dues and not impaired, there were no
indication of default in repayment as at the year end. The company has
provided for the financial assets based on the best estimate.

Accordingly ECL disclosure are not given for the same. The company has
used a practical expedient and analysed the recoverable amount of
receivables on an individual basis by computing the expected loss
allowance for financial assets based on historical credit loss experience.

D. Liquidity risk

(i) Liquidity risk management

Liquidity risk is the risk that the company will encounter difficulty in
meeting the obligations associated with its financial liabilities that are
settled by delivering cash or another financial asset. The company
approach when damage to the company reputation. The company believes
that the working capital is sufficient to meet its current requirements.
Accordingly, no significant liquidity risk is perceived. As of 31 March 2025,

the company had a working capital of INR 3075.90 lakhs (31 March 2024:
INR 655.43 lakhs) cash and cash equivalents as of 31 March 2025 INR
775.11 lakhs (31 March 2024: INR 5.07 lakhs) and other bank balances
as of 31 March 2025 INR 1.01 lakhs (31 March 2024: Nil).

(ii) Maturities of financial liabilities

The table below provides details regarding the contractual maturities of
significant financial liabilities as of March 31, 2025:

E. 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
prices comprises two types of risk: currency rate risk and interest rate
risk.

Financial instruments affected by market risks include loans and
borrowings, deposits, investments and payables.

(i) 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. The company''s exposure to the risk of changes in market interest
rates relates primarily to the company''s borrowing with floating interest
rates. The company constantly monitors the credit markets and
rebalances its financing strategies to achieve an optimal maturity profile

28. Earnings Per Share

Basic EPS amounts are calculated by dividing the profit for the year
attributable to equity holders by the weighted average number of equity
shares outstanding during the year.

30. MSME

There are no dues payable to suppliers under Micro, Small and Medium

Enterprises Development Act, 2006.

31. Subsequent Events

There are no significant events that occurred after the balance sheet date.

32. Prior year comparatives

The figures of the previous year have been regrouped/reclassified, where

necessary, to conform with the current year’s classification.

33. Additional Regulatory Information

i) The company doesn’t possess any immovable property. In respect
of immovable properties taken on lease and disclosed as
property, plant and equipment in the Ind AS financial
statements, the lease agreements are duly executed in the name
of the Company.

ii) The Company has not revalued any of its Property, Plant and
Equipment during the year.

iii) No loans and advances were granted to promoters, directors,
KMPs and the related parties.

iv) The company did not hold any Benami Property and hence no
proceedings were initiated or pending against the company.

v) There are no borrowings from banks on the basis of current
assets given as security. Returns and statements submitted by
the company are in agreement with the Books of Account.

vi) The company was not declared as a wilful defaulter by any bank
or financial institution.

vii) The company did not enter into any transactions with struck off
companies.

viii) Ratios

Pursuant to an Application filed by M/s Tack Innovations (‘Operational
Creditor’) under Section 9 of the Code for initiation of Corporate Insolvency
Resolution Process (‘CIRP’), to the Hon’ble National Company Law
Tribunal, Jaipur Bench (Adjudicating Authority). By virtue of this
application, the Hon’ble National Company Law Tribunal, Jaipur Bench,
vide its order dated September 23,2024 (Adjudicating Authority) approved
the Resolution plan (“Approved Resolution Plan”) submitted by Raja
Srinivas Nandigam (Managing Director and CEO of RNIT Solutions &
Services Limited) and Mr. Vivek Kumar Ratakonda (Fellow member of the
Institute of Chartered Accountants of India) collectively referred to as the
“Resolution Applicants”, along with the scheme of arrangement (for the
merger M/s RNIT Solutions & Services Limited into RNIT AI Solutions

Limited) and addendum, annexure, schedules forming part of the
resolution plan. The following consequential impacts have been given in
accordance with approved Resolution plan/Accounting Standards:

a) The existing Directors of the Company as on the date of order have
stand replaced by the new Board of Directors from their office with
effect from 08 October, 2024. As on date Board consist of Raja Srinivas
Nandigam (Managing Director), Neelima Nandigam, (Director & CEO),
Pramod Reddy mallaiahgari (Director), Malladi Venkata Satya Surya
Subrahmanya shastri (CFO).

b) The Authorised Capital of RNIT AI SOLUTIONS LIMITED has been
increased to Rs.85 crores consisting of 8,50,00,000 shares of Rs. 10/-
each to accommodate the issuance of the shares pursuant to the
approval of the Resolution Plan.

c) In respect of de-recognition of operational and financial creditors along
with assets, the net difference amounting to 2233.63 Lakhs between
the carrying amounts of financial liabilities extinguished and
consideration paid along with value of assets, is recognised in Capital
reserve account in accordance with Ind AS and guidance as prescribed
under section 133 of the Companies Act, 2013 and accounting policies
consistently followed by the company.

d) From the order of NCLT Cancellation of the Public Shareholders’
shares, to the extent of 75% of their shareholding as of Record date. In
other words, the Corporate Debtor shall issue and allot One Equity
Share of Rs.10/- each for every 4 Equity Shares of Rs. 10/- each held
by the public shareholders other than existing promoters. Further, by
virtue of this order the existing issued, subscribed and paid-up
15,00,000 9% redeemable non-cumulative preference shares of Rs.10
each stand fully cancelled and extinguished. Further Pursuant to the
approval of the resolution by the Hon’ble NCLT, the Board of Directors
in the said Meeting allotted 7,13,74,990 Equity shares of Rs. 10/- each
fully paid up to the shareholders of the M/s RNIT Solutions & Services
Limited (Transferor Company) in the following swap ratio: "Five Equity
Shares of Rs 10/-each of M/s RNIT AI Solutions Limited shall be issued
for every One Equity Share of Rs 10 each to every shareholder of M/s
RNIT Solutions & Services Limited held on Record Date". Accordingly,
an allotment of 7,13,74,990 Equity shares of Rs. 10/- each fully paid
up made to the Shareholders of M/s. RNIT Solutions & Services Limited

as a consideration for the merger of the Transferor Company into the
Corporate Debtor.

e) Pursuant to the order of Amalgamation of the RNIT Solutions & Services
Limited, all the assets and liabilities transferred and vested in the
Transferee Company.

f) Out of the funds received from Resolution applicants amounting to 300
lakh, 36.44 lakh was allocated for the settlement of financial creditors''
claims, 14.48 lakh to Operational creditors, 52.00 lakh towards CIRP
costs, 24.08 lakh towards Statutory dues, while the remaining 173 lakh
was designated for meeting the company''s operational and working
capital requirements.

g) Amalgamation of the RNIT Solutions & Services Limited into RNIT AI
Solutions Limited.

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Mar 31, 2015

1. Terms/rights attached to equity shares

The company has equity shares having a face value of Rs. 10 per share and preference share of Rs. 10 per share. Each equity share holder 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 the remaining assets of the company, after distribution of all preferential amounts and after payment to Preference Share Capital.

2. Prior Period Items

During the year company has reversed the excess provision of tax made in the last year amounting Rs. 74049

3. Amount to be transferred to Investors Education and Protection Fund u/s 205A/ 205C of Companies Act, 1956:-

(a) Unpaid dividend of Rs.204428/-

(b) Unpaid application of Rs. 82646/-

The above amounts are pending since long time.

4. The Debit and credit balances of Sundry Creditors, Sundry Debtors and Advances are subject to confirmation and reconciliation and are relied upon book balances and as certified by the management.

5. a) Overdue amount payable to SSI & Ancillary undertaking could not be ascertained as the necessary details are not available with the company as stated by the company.

b) In absence of details provided by the company, it is difficult to provide information that there are dues for more than 45 days to the Micro, Small & Medium enterprises as defined under MSMED Act, 2006.

6. Previous year figures are regrouped and rearranged wherever necessary.

7. Segment Reporting:

As the Company's business activities fall majority within a single primary segment viz. "Manufacturing of LED", the disclosure requirements of Accounting Standard - 17 "Segment Reporting" are not applicable.

8. Related party transaction:

The Company has identified all related parties and details of transaction are given below:-

i) Subsidiary of the Company : None

ii) Key Management personnel:

a) Dharam Pal Gupta

b) Anup Gupta

c) RatanLalRawat

d) Mata Deen Sharma (Resigned during the FY 2014-15)

e) Shailendra Kumar

f) Anubha Gupta

g) Abhishek Gupta (Appointed during the FY 2014-15 w.e.f. 01.11.2014)

h) Praveen Kumawat

iii) Companies having Relatives of key Management personnel with whom transaction have taken place:

a) Autopal Distribution Pvt. Ltd.

b) Autolite India Ltd.

iv) Concerns having same managerial persons:

a) Man Radio & Electricals Pvt. Ltd.

b) GK-Autopal Lighting Solutions LLP

c) Win ProInfolink Pvt. Ltd.

9. Contingent Liability

Liability for ESI payable of Rs.4.38 Lacs.(Previous Year Rs. 4.38 Lacs)

10. Extra Ordinary Items

The Company has written off certain old outstanding dues from debtors that arise from transactions that are clearly distinct from ordinary activities, AS-5 "Net profit or loss for the period, prior period items and change in accounting policies ", therefore the company has disclosed such expenses of Rs 8,78,051/- separately in profit and loss account during the year 14-15. (Previous Year Rs. 40,18,177)

11. Expenditure in foreign currency

Expenditure incurred in foreign currency for: Travelling Expenses Rs. 93,190/- Purchase of Imported Material Rs. 91,69,283/- (Previous Year Rs. 55,17,896) Purchase of Traded goods Rs. 3,32,25,833/- Purchase of Plant & Machinery components Rs. 2,24,831/-

12. Effect of Hon'ble Board for Industrial and Financial Reconstruction (BIFR) order on the Books of accounts.

During the year w.e.f. 22th August 2014 the company is ceased to be a sick industrial company within the meaning of section 3(1) (o) of SICA, 1985 and therefore it is discharged from the purview of SICA. However, the unimplemented provisions of the sanctioned scheme, if any shall continue to be implemented by the company.

(i) In Compliance of order company has written off to the extent of 75%of old dues of sundry creditors andbalance 25% has to be paid in 1/5 annual installment. In compliance of the same the company has made payment in full to some of the creditors who have nominal amount and 1/5th paymenthas been made during the year through employee to rest of the creditors in compliance of BIFR orderas reported by the company.

(ii) Fixed Deposits from public amounting Rs. 95,725/- is outstanding as at the beginning of the year out of which no payment has been made during the year.

(iii) Interest Payable on Public Deposit amounting to Rs. 1,28,683/- is outstanding in the opening out of which no payment has been made during the year.

Hence, as stated by the management company has not complied with the last 2 terms and condition of BIFR Scheme. However company will finally pay this outstanding amount till March 2016 as per BIFR order.

The same is due to the estimate considered by the management of the company considering absence of reasonable certainty in the near future that the same will be reversed.

13. Depreciation on fixed assets is provided to the extent of Depreciable amount on straight-line method. Depreciation is provided based on useful life of the assets as prescribed in Schedule II to the Companies Act, 2013.Salvage Value of the assets has been taken @5% of Original Cost as prescribed in Schedule II except Building @20% and Car @ 20% .The written down value of Fixed assets whose lives have expired as at 01st April 2014 have been adjusted in the opening balance of Reserves and Surplus amounting to Rs. 38,01,023.

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Mar 31, 2014

1. During the year company has issued 500000, 9% Redeemable Non-Cumulative Preference Shares of Rs 10 each fully paid up to Anup Gupta 2,50,000 Preference Shares and Anubha Gupta 2,50,000 Preference Shares.

2. Terms/rights attached to equity shares

The company has equity shares having a value of Rs. 10 per share and preference share of Rs. 10 per share. Each equity share holder 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 the remaining assets of the company, after distribution of all preferential amounts and after payment to Preference Share Capital.

#The company has taken term Loan from BMW Financial Services Private limited which is secured by way of hypothecation of vehicle(BMW) which is repayable on equated monthly installments over a period of 5 Years. The rate of interest is 10.81%

##The company has taken term Loan from ICICI BANK LTD which is secured by way of hypothecation of vehicle(Audi) which is repayable on equated monthly installments over a period of 5 Years. The rate of interest is 10.39%

###The company has taken term loan from Electronica Finance Ltd which is secured by way of hypothecation of Plant and Machinery which is repayable on equated monthly installments over a period of 4 Years. The rate of interest is 14.09%.

####The company has taken term loan account from Union Bank Of India which is secured by way of hypothecation of Plant and Machinery which is repayable on equated monthly installments over a period of 5 Years. The rate of interest is 14.25%.

3. Amount to be transferred to Investors Education and Protection Fund u/s 205A/ 205C of Companies Act, 1956:-

(a) Unpaid dividend of Rs.204428/-

(b) Unpaid application of Rs. 82646/-

The above amounts are pending since long time.

4. The Debit and credit balances of Sundry Creditors, Sundry Debtors and Advances are subject to confirmation and reconciliation and are relied upon book balances and as certified by the management.

5. Excise Duty payable on finished goods is accounted for on clearance of goods from factory. The amount of excise duty receivable on finished goods stock lying in factory as at 31.03.2014 is estimated at Rs.1464409/-.

6. a) Overdue amount payable to SSI & Ancillary undertaking could not be ascertained as the necessary details are not available with the company as stated by the company.

b) In absence of details provided by the company, it is difficult to provide information that there are dues for more than 45 days to the Micro, Small & Medium enterprises as defined under MSMED Act, 2006.

c) Previous year figures are regrouped and rearranged wherever necessary.

7. Segment Reporting:

The Groups'' operation segmentation predominantly relates to manufacturing and trading of LED, CR Coil n Cut etc. during year ended March 31, 2014. The accounting principles used in the preparation of financial statements are consistently applied to record revenue & expenditure in Individual segment, and are as set out in the significant accounting policies.

Business segment for the Group are primarily manufacturing LED and trading in LED & CR Coil n cut. Calculated revenue and identifiable operating expenses in relation to segment are categorized based on items that are individually identifiable to that segment. Allocated expenses of segment are categorized on the basis of segment. The management believes that certain expenses not specifically allocable to specific segment are separately disclosed as "unallocated" and adjusted against the total Income of the Group.

Fixed assets or liabilities have not been identified to any of the reportable segment. Accordingly, no disclosure relating to total segment assets and liabilities are made.

8. Related party transaction:

The Company has identified all related parties and details of transaction are given below:-

i) Subsidiary of the Company: None

ii) Enterprise in which the Company is having substantial interest/significant influence directly or indirectly: None

iii) Key Management personnel:

a) Dharam Pal Gupta

b) Anup Gupta

c) Ram RatanRawat

d) Mata Deen Sharma

e) Shailendra Kumar

f) Anubha Gupta

iv) Companies having Relatives of key Management personnel with whom transaction have taken place:

a) Autopal Distribution Pvt. Ltd.

b) Autolite India Ltd.

There are no other related parties where control exists that need to be disclosed.

9. Contingent Liability

The Sales Tax Department has raised a demand against the company for Rs. 127.60 lacs. However, as per the order of Honorable BIFR it has been directed to reconcile the said demand with company and waive off the interest and penalty thereon and to pay the actual demand in five years on interest basis. The required documents have been filed with the Department and no reply has been received from the Department but sales tax department has not yet reconciled the dues. However, in the auditor''s report the liability accepted by the company has been disclosed .Liability for ESI payable of Rs.4.38 Lacs.

10. Extra Ordinary Items

The Company has written off certain old outstanding dues from debtors that arise from transactions that are clearly distinct from ordinary activities , AS-5 "Net profit or loss for the period , prior period items and change in accounting policies", therefore the company has disclosed such expenses of Rs 40,18,177 separately in profit and loss account during the year 13-14.

11. Expenditure in foreign currency

Expenditure incurred in foreign currency for purchase of raw material is 5517896/-.

12. Effect of Hon''ble Board for Industrial And Financial Reconstruction (BIFR) order on the Books of accounts.

In view of accumulated losses exceeding its net worth in the previous years, and as per the information provided by the management, the company was declared SICK undertaking within the meaning of SICA Act, 1985, by honorable BIFR in the hearing held on 25.08.2005 and sanctioned the rehabilitation scheme on 26.05.2011 as proposed by the company.

In Compliance of order company has written off to the extent of 75%of old dues of sundry creditors and balance 25% has to be paid in 1/5 annual installment. In compliance of the same the company has made payment in full to some of the creditors who have nominal amount and 1/5th payment of Rs. 8,67,900/- has been made during the year through employee to rest of the creditors in compliance of BIFR order as reported by the company .

Fixed Deposits from public amounting Rs. 1,41,525/- is outstanding out of which Rs. 45,800/- have been paid to public as per BIFR order. The balance outstanding as on 31.03.2014 is Rs.95,725/-. Interest Payable on Public Deposit amounting to Rs. 2,86,356/- is outstanding in the opening out of which Rs.1,68,680/- has been paid as required under BIFR order. The balance outstanding as on 31.03.2014 is Rs.1,17,676/-.Hence, as stated by the management company has complied all the terms and condition of BIFR Scheme

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Mar 31, 2013

1.1.Amount to be transferred to Investors Education and Protection Fund u/s 205A/ 205C of Companies Act, 1956:-

(a) Unpaid dividend-Rs. 204428/-

(b) Unpaid application money received for allotment of securities and due for refundRs.82646/-

The above amounts are pending since long time.

1.2.The Debit and credit balances of Sundry Creditors, Sundry Debtors and Advances are subject to confirmation and reconciliation and are relied upon book balances and as certified by the management.

1.3.Excise Duty payable on finished goods is accounted for on clearance of goods from factory. The amount of excise duty receivable on finished goods stock lying in factory as at 31.03.2013 is estimated at Rs. 1,44,017/-.

1.4. a) Overdue amount payable to SSI & Ancillary undertaking could not be ascertained as the necessary details are not available with the company as stated by the company.

b) In absence of details provided by the company, it is difficult to provide information that there are dues for more than 45 days to the Micro, Small & Medium enterprises as defined under MSMED Act, 2006.

1.5. Segment Reporting:

The Groups operation segmentation predominantly relates to manufacturing and trading of CFL, LED, Down Liters etc and

Technical Know-how Services during year ended March 31, 2012. The accounting principles used in the preparation of financial statements are consistently applied to record revenue & expenditure in Individual segment, and are as set out in the significant accounting policies.

Business segment for the Group are primarily manufacturing CFL, LED and Down liters and also providing consultancy service in the field of lighting and trading activity.

Calculated revenue and identifiable operating expenses in relation to segment are categorized based on items that are individually identifiable to that segment. Allocated expenses of segment are categorized on the basis of segment. The management believes that certain expenses not specifically allocable to specific segment are separately disclosed as "unallocated" and adjusted against the total Income of the Group.

Fixed assets or liabilities have not been identified to any of the reportable segment. Accordingly, no disclosure relating to total segment assets and liabilities are made.

1.6. Related party transaction:

The Company has identified all related parties and details of transaction are given below:- i) Subsidiary of the Company: None

ii) Enterprise in which the Company is having substantial interest/significant influence directly or indirectly: None

iii) Key Management personnel:

a) Dharam Pal Gupta

b) Anup Gupta

c) Ratan Lal Rawat

d) Mata Deen Sharma

e) Shailendra Kumar

iv) Companies having Relatives of key Management personnel with whom transaction have taken place:

a) Autopal Distribution Pvt. Ltd.

b) Autolite India Ltd.

v) During the year company has issued 10,00,000 9% Redeemable Non- Cumulative Preference shares of Rs. 10 each fully Paid to the promoters against their outstanding loans.

1.7. Contingent Liability

The Sales Tax Department has raised a demand against the company for Rs. 127.60 lacs. However, as per the order of Honorable BIFR it has been directed to reconcile the said demand with company and waive off the interest and penalty thereon and to pay the actual demand in five years on interest basis. The required documents have been filed with the Department and no reply has been received from the Department but sales tax department has not yet reconciled the dues.

Liability for ESI and PF payable of Rs. 4.38 Lacs and Rs.16.51 Lacs respectively has been waived off in terms of BIFR order however it is treated as contingent liability since F.Y. 2009-10.

1.8. Provision for Gratuity

The liability in respect of payment under employees gratuity is provided as per calculation by the HR department of the company not by Actuarial Valuation as required by AS-15. The Provision of Rs. 82007/- is made on the basis of The Payment of Gratuity Act, 1972 such as 15 days salary considering a month of 26 for completed years of service as per chart and summary is as follow:

1.9. Service Tax Payable

The company is regularly paying its service tax due amount. But the service tax payable by the company for the half yearly ended on 31/03/2013 i.e. Rs. 1559363/- has not been paid till date of Audit and will be paid under Service Tax Voluntary Compliance Encouragement Scheme 2013 as informed by the management.

1.10. Expenditure in foreign currency

Expenditure incurred in foreign currency for purchase of raw material is Rs. 55,38,968/-.

1.11. Effect of Hon''ble Board for Industrial And Financial Reconstruction (BIFR) order on the Books of accounts.

In view of accumulated losses exceeding its net worth in the previous years, and as per the information provided by the management, the company was declared SICK undertaking within the meaning of SICA Act, 1985, by honorable BIFR in the hearing held on 25.08.2005 and sanctioned the rehabilitation scheme on 26.05.2011 as proposed by the company.

(i) In Compliance of order company has written off to the extent of 75% of old dues of sundry creditors And balance 25% has to be paid in 1/5 annual installment. In compliance of the same the company has made payment in full to some of the creditors who have nominal amount and 1/5th payment of Rs. 5,54,946/- has been made during the year through employee to rest of the creditors in compliance of BIFR order as reported by the company .

(ii) Fixed Deposits from public amounting Rs. 1.88 Lacs is outstanding out of which 1/5th payment have been made to public as per BIFR order. The balance outstanding as on 31.03.2013 is Rs.1.42 Lacs.

(iii)Interest Payable on Public Deposit amounting to Rs. 3.81 Lacs is outstanding out of which the payment of 1/5th amount has been made as required under BIFR order. The balance outstanding as on 31.03.2013 is Rs. 2.86 Lacs.

Hence, as stated by the management company has complied all the terms and condition of BIFR Scheme

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Mar 31, 2012

Corporate Information

Autopal Industries Limited (AIL) incorporated as a public limited company under the provision of Companies Act 1956. The present directors and key management persons are Shri Dharam Pal Gupta, Anup Gupta, Ram Ratan Rawat, Shailender Kumar and Mata Deen Shanna. The company is in the production of CFL''s (Compact Fluorescent Lamps) and also entered in the product line of - LED''s. Conservation of energy is the need of the hour. Due to limited power resources, the burden of cost on an average person is inflating day by day, which can be addressed by using energy saving product viz. Compact Fluorescent Lamps (CFL)/ LED. A trend of power efficient lightening equipments is following on. Urban people are continuously using the CFL as they are cost conscious and understanding the benefits of energy efficient measures. The Government started making publicity in semi-urban and rural areas regarding the benefits of usage of LED/CFL over traditional incandescent bulbs and it helps the industry to create new demand of the products. The LED is very cost conscious and uses less energy. The market of LED is on the boom in the current scenario.

Effect of Hon''ble Board for Industrial and Financial Reconstruction (BIFR) order on the Books of Accounts in view of accumulated losses exceeding its net worth in the previous years, and as per the information provided by the management, the company was declared SICK undertaking within the meaning of SICA Act, 1985, by honorable BIFR in the hearing held on 25.08.2005 and sanctioned the rehabilitation scheme on 26.05.2011 as proposed by the company.

i) Share Capital have been reduced by 60% of the existing equity share capital to wipe out the accumulated losses of Rs. 3070.05 Lacs. So the value of equity share capital has been reduced by Rs. 382.10 lacs.

ii) The promoter i.e Anup Gupta and Dharam Pal Gupta has brought additional capital of Rs. 60 lacs and 40 lacs respectively to meet cost of rehabilitation scheme.

iii) Dues of old sundry creditors amounting to Rs. 70.71 Lacs has been written off to the extent of 75% and payment has been made in full to some of the creditors who have nominal amount and 1/5111 payment have been made to rest of the creditors as per BIFR order.

iv) The company has waived off 75% of old sundry creditors amounting to Rs. 130.18 lacs and out of rest 25%, l/5th payment had been made during die year in cash to these creditors as reported by the company and to some of the creditors payment has been made in full who have nominal amount in compliance of BIFR

v) In Loan of Autolite (India) limited have also been written off to the extent of 75% and for remaining 25%, consultancy has been provided for Rs.165.45 lacs (inclusive of service tax) as sale of technical know how and rest amount Rs.99.73 lacs are still outstanding in loan account.

vi) The Sales Tax Department has raised a demand against the company for Rs. 127.60 lacs. However as per the order of BIFR it has been directed to reconcile the said demand with company and waive off the interest and penalty thereon but sale tax department has not yet reconciled the dues.

vii) Liability for ESI and PF payable of Rs.4.38 Lacs and Rs. 16.51 Lacs respectively has been waived off which was shown as contingent liability in the FY. 2009-10.

viii) The company has been exempted from the payment of customs duty on machines imported.

ix) State Investment Subsidy of Rs. 15 lacs, Securities Premium reserve of Rs. 824.51 lacs, Remission of liabilities (SBBJ) of Rs. 151.38 lacs, Remission of Liabilities (IFCI) of Rs. 75 lacs. Remission of Liabilities (SBOP) of Rs. 57.8 lacs and General Reserve of Rs. 200 lacs has been written off fully as per BIFR order.

x) Fixed Deposits from public amounting to Rs. 11.28 Lacs has been written off to the extent of 75% and l/5th payment have been made to public as per BIFR order. The balance outstanding as on 31.03.2012 is Rs. 1,88,259/-

xi) Interest Payable on Public Deposit amounting to Rs. 18.45 lacs has been written off to the extent of 75% as per BIFR order and balance amount is still pending. The payment of 1/5 amount has been made as required under BIFR order. The balance outstanding as on 31.03.2012 is Rs.3,81,803/-.

xii) The company was having long term deposit amounting to Rs. 33.67 lacs, against which company has paid Rs. 3 lacs and balance was written off in the financial year 2010-11

xiii) The company has been exempted from the payment of electricity duty and control on electricity for a period of five years from the date of sanction of the Hon''ble BIFR scheme. Hence, as stated by the management Company has complied all the terms and conditions of BIFR Scheme.

1.1 Amount to be transferred to Investors Education and Protection Fund u/s 205A/ 205C of Companies Act, 1956:-

(a) Unpaid dividend- Rs.204428/-

(b) Unpaid application money received for allotment of securities and due for refund Rs. 826467-

The above amount is pending since long time.

1.2 The Debit and credit balances of Sundry Creditors, Sundry Debtors and Advances are subject to confirmation and reconciliation and are relied upon book balances and as certified by the management.

1.3 Excise Duty payable on finished goods is accounted for on clearance of goods from factory. The amount of excise duty payable on finished goods stock lying in factory as at 31.03.2012 is estimated at Rs. 1,52,360/-.

1.4 a) Overdue amount payable to SSI & Ancillary undertaking could not be ascertained as the necessary details are not available witii the company as stated by the company, b) In absence of details provided by the company, it is difficult to provide information that there are dues for more than 45 days to the Micro, Small & Medium enterprises as defined under MSMED Act, 2006.

1.5 Extra Ordinary Items

Extraordinary items includes Sundry balances written off in compliance with the BIFR Scheme of Rs. 50,43,314/-.

1.6 Segment Reporting

The Groups'' operation segmentation predominantly relate to manufacturing and trading of CFL, LED, Down Liters etc and Technical Know-how Services during year ended March 31, 2012. The accounting principles used in the preparation of financial statements are consistently applied to record revenue & expenditure in Individual segment, and are as set out in the significant accounting policies.

Business segment for the Group are primarily manufacturing CFL, LED and Down liters and also providing consultancy service in the field of lighting and trading activity .

Calculated revenue and identifiable operating expenses in relation to segment are categorized based on items that are individually identifiable to that segment. Allocated expenses of segment are categorized on the basis of segment. The management believes that certain expenses not specifically allocable to specific segment are separately disclosed as "unallocated" and adjusted against the total Income of the Group.

Fixed assets or liabilities contracted have not been identified to any of the reportable segment. Accordingly, no disclosure relating to total segment assets and liabilities are made.

1.7 Related party transaction:

The Company has identified all related parties and details of transaction are given below.

There are no other related parties where control exists that need to be disclosed :

i) Subsidiary of the Company : None

ii) Enterprise in which the Company is having substantial interest/significant influence directly or indirectly: None

iii) Key Management personnel:

a) Dharam Pal Gupta

b) Anup Gupta

c) Ratan Lai Rawat

d) Mata Deen Sharma

e) Shailendra Kumar

iv) Companies having Relatives of key Management personnel with whom transaction have taken place:

a) Autopal Distribution Pvt. Ltd.

b) Autolite India Ltd.

1.8 Contingent Liability

The Sales Tax Department has raised a demand against the company for Rs. 127.60 lacs. However, as per the order of Honorable BIFR it has been directed to reconcile the said demand with company and waive off the interest and penalty thereon and to pay the actual demand in five equal annual installments on interest basis. The required documents have been filed with the Department and no reply has been received from the Department.

1.9 Service Tax Payable

The company is regularly paying its service tax due amount. But die service tax payable by the company for the half yearly ended on 31 /03/2012 i.e. Rs 17,03,363/- has not been paid till date of Audit.

1.10 Expenditure in foreign currency

Expenditure incurred in foreign currency for purchase of raw material Rs. Nil (Previous Year Rs. 15,42,241)

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Mar 31, 2010

1. CONTINGENT LIABILITIES NOT PROVIDED FOR:

(a) Estimated amount payable under different Labour laws Rs.214.00 Lacs.

(b ) Estimated amount payable under P.F. Act towards interest / penalty on outstanding P.F. amount Rs. 16.51 Lacs.

(c-) Estimated amount payable under E.S.I Act towards interest / penalty on outstanding E.S.I, amount Rs.4.38 Lacs.

(d) The Land & Building Tax Deptt. has raised demand of Rs.27.85 Lacs against the Com- pany for the period from 1993-94 to 2001- 2002, for which Company has protested with the authorities.

(e) The Sales Tax Deptt. has raised demands against the Company for Rs.316.01 Lacs for which the Company has protested in appeal.

(g) The Sales Tax Deptt. has raised demand for call back sales tax incentive for Rs.367.21 Lacs for which the company has protested in appeal.

2. Excise duty payable on Finished Goods is accounted for on clearance of goods from factory. The amount of excise duty payable on finished goods stock lying in factory as at 31.03.2010 is estimated at Rs. 155,307/-.

3. In view of accumulated losses exceeding its net worth, and as per the information provided by the Management, the Company has been declared SICK undertaking within the meaning of SICA Act, 1985, by honorable BIFR in the hearing held on 25.08.2005

4. (a)Overdue amount payable to SSI & Ancillary undertaking could not be ascertained as the necessary details are not availabe with the Company.

(b) In absence of details provided by the Company, it is difficult to provide information that there are dues for more than 45 days to the Micro, Small & Medium enterprises.

5. The Debit and Credit balances of Sundry Crediors, Sundry Debtors and Advances are subject to confirmation and reconciliation and are relied upon book balances.

6. The stock lying with C&F agents are not verifiable at the year end. hence taken as per Companys records.

7. LICENCED & INSTALLED CAPACITY AND PRODUCTION : (a) Licenced Capacity :

Halogen Lamps N.A.

C.F.L. N.A.

Fixture & Electronics N.A.

(e) Expenditure incurred in foreign currency for purchase of raw material Rs. 1379253/ - (Previous year Rs. 540600/-)

8. No remuneration was paid during the year to Directors. (Previous year Nil)

9. Segment reporting :

As the Company is engaged in production of single item C.F.L. during the year under review the segment reporting requirement of AS-17 issued by the Institute of Chartered Accountants of India, is not applicable to the Company.

10. Related party transactions :

The Company has identified all related parties and details of transaction are given below. Suitable provision for doubtful advances have been made. There are no other related parties where control exists that needs to be disclosed :

i) Subsidiary of the Company : None

ii) Enterprises in which the Company is having substantial interest/significant influence directly or indirectly : Autolite (India) Limited

iii) Key management personnel

a) Anup Gupta

b) R. L. Rawat

c) M. D. Sharma

iv) Relatives of key management personnel with whom transactions have taken place : None

v ) Enterprises over which persons described in (ii) or (iii) above are able to excercise significant influence and with which transactions have taken place : a) Alwar A-uto Private Limited

b) Autopal Marketing Private Limited

c) Sonakshi Capital Services Private Ltd.

d) Palsons Automotive Pvt. Ltd.

e) AKX Lighting Pvt. Ltd.

11. Accounting for Taxes on Income :

Deferred Tax Assets are not recognised on ac- count of unabsorbed depreciation and carry forward of losses and other timing differences under Tax laws as there is no convincing evi- dence to support that sufficient future taxable income will be available against which deferred tax assets can be realized.

12. As per the Accounting Standard AS28 issued by the Institute of Chartered Accountants of India, the management of the Company has not identified the impaired assets.

13. The figures have been rounded off to nearest rupee.

14. Previous year figures have been rearranged/ regrouped wherever considered necessary. Figures shown in the Brackets are for the previous year.