13. Provisions and Contingent Liabilities

The Company recognizes a provision when there is a present obligation as a result of past event that probably requires
an out flow of resources and a reliable estimate can be made of the amount of obligation. A disclosure for a
Contingent Liability is made when there is a possible obligation from a past event but their existence will be
confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control
of the company

14. Revenue Recognition

In accordance with Ind AS 115 “Revenue from Contracts with customers”, Revenue from contracts with customers
is recognized on transfer of control of promised goods or services to a customer at an amount that reflects the
consideration to which the Company is expected to be entitled to in exchange for those goods or services.

(i) Sale of Goods

Revenue from the sale of goods is recognized when the Company satisfies the performance obligation in
accordance with the provisions of contract with customer. This is achieved when control of the product
has been transferred to the customer, which is generally determined when title, ownership, risk of
obsolesce and loss pass to the customer and Company has present right to payment. The Company collects
goods and services tax (GST) on behalf of the government and, therefore, these are not economic benefits
flowing to the Company. Hence, they are excluded from revenue.

(ii) Interest Income

Interest Income is recognized based on time proportion basis considering the amount outstanding and the
rate applicable. Interest Income is included in the Other Income in the statement of Profit and Loss.

15. Income Tax

(i) Current Income Tax

Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance
with the Income Tax Act, 1961.

(ii) Deferred Tax

Deferred tax is provided using the balance sheet approach on temporary differences between the tax bases
of assets and liabilities and their carrying amount for the financial reporting purposes at the reporting date.
Deferred Tax assets are recognized to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences and the carry forward of unused tax credits and unused
tax losses can be utilized. Current and deferred tax is recognized in the statement of Profit and Loss, except
to the extent that it relates to the items recognized in the other comprehensive income or directly in equity.

16. Employee benefits

The present value of the defined benefit obligations depends on a number of factors that are determined on a n
actuarial basis using a number of assumptions

(i) Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly
within 12 months after the end of the period in which the employees render the related service are
recognized in respect of employees services upto the end of reporting and are measured at the amounts
expected to be paid when the liabilities are settled.

(ii) Long term obligations

The liabilities for earned leave and sick leave that are not expected to be settled wholly within 12 months
are measured at the present value of expected future payments to be made in respect of services made by
employees upto the end of the reporting period. The benefits are discounted using the government
securities at the end of reporting period.

(iii) Post employment obligations - Gratuity

The liability or asset recognized in the balance sheet in respect of defined benefit gratuity plans is the
present value of the defined benefit obligation at the end of the reporting period less the fair value of the
plan assets. The present value of the obligation is determined by discounting the estimated future cash
outflows by reference to market yields at the end of the reporting period on government bonds that have
the term approximating to the terms of the related obligations.

17. Earnings per Share

Basic earnings per share are computed by dividing the profit for the year attributable to the equity shareholders for
the year by the weighted average number of shares outstanding during the year.

18. Cash Flow

The investing and financing activities in cash flow statement do not have a direct impact on current cash flows
although they do affect the capital and asset structure of an entity. The company has disclosed these transactions, to
the extent, material in notes to cash flow statement.

19. Segment Reporting

The Company has identified that its operating activity is a single primary business segment. Accordingly, whole of
India has been considered as one geographical segment. Hence, segment reporting is not applicable.

20. Foreign Currencies

Transactions in foreign currencies are initially recorded by the Company at the functional currency spot rates (i.e.
INR) at the date the transaction first qualifies for recognition. Monetary assets and liabilities denominated in foreign
currencies are translated at the functional currency spot rates of exchange at the reporting date.

Foreign exchange gains and losses resulting from the settlement of transactions in foreign currencies and from the
translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are
generally recognized in Statement of Profit and Loss.

21. Research and Development

Research and Development expenditures of revenue nature are charged to Profit & Loss Account, while capital
expenditure is added to the cost of fixed assets in the year in which these are incurred.

22. Lease

a. Where the Company is the lessee

The company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use
asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease
payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs
to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less
any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to
the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful
lives of right-of-use assets are determined on the same basis as those of property and equipment. In addition, the
right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain re-measurements of
the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, company’s incremental borrowing rate.

Generally, the company uses its incremental borrowing rate as the discount rate.

Lease payments included in the measurement of the lease liability comprise the following:

Fixed payments, including in-substance fixed payments;

Variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the
commencement date;

Amounts expected to be payable under a residual value guarantee; and

The exercise price under a purchase option that the company is reasonably certain to exercise, lease payments in an
optional renewal period if the company is reasonably certain to exercise an extension option, and penalties for early
termination of a lease unless the company is reasonably certain not to terminate early.

Short-term leases and leases of low-value assets

The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of real estate
properties that have a lease term of 12 months. The company recognises the lease payments associated with these
leases as an expense on a straight-line basis over the lease term.

b. Where the Company is the lessor

Assets subject to operating leases are included in fixed assets. Lease income is recognised in the statement of profit
and loss on a straight-line basis over the lease term. Costs, including depreciation are recognised as an expense in
the statement of Profit &Loss. Initial direct costs such as legal costs, brokerage costs, etc. are recognised immediately
in the statement of Profit &Loss.

Assets given under a finance lease are recognised as a receivable at an amount equal to the net investment in the
lease. Lease income is recognised over the period of the lease so as to yield a constant rate of return on the net
investment in the lease. Initial direct costs relating to assets given on finance leases are charged to Statement of
Profit and Loss.

23. Operating Segments

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision-maker (CODM). The CODM who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the Board of Directors of the Company.

24. Standard notified but not yet effective:

There are no new standards that are notified but not yet effective up to the date of issuance of the company’s
financial statement.

25. Recent Pronouncement

Ind AS 1 - Presentation of Financial Statements - This amendment requires the entities to disclose their material accounting
policies rather than their significant accounting policies. The effective date for adoption of this amendment is annual periods
beginning on or after April 1, 2023. The company has evaluated the amendment and the impact of the amendment is
insignificant in the standalone financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors - This amendment has introduced a definition
of 'accounting estimates' and included amendments to Ind AS 8 to help entities distinguish changes in accounting policies from
changes in accounting estimates. The effective date for adoption of this amendment is annual periods beginning on or after
April 1, 2023. The company has evaluated the amendment and there is no impact on its standalone financial statements.

Disclosure under MSMED act.

a. the principal amount and the interest due thereon remaining unpaid to any supplier as at the end
of accounting year

b. Interest paid by the buyer under MSMED Act, 2006 along with the amounts of the payment
made to the supplier beyond the appointed day during each accounting year

c. Interest due and payable for the period (where the principal has been paid but interest under the
MSMED Act, 2006 not paid)

d. The amount of interest accrued and remaining unpaid at the end of accounting year

e. Interest due and payable even in the succeeding year, until such date when the interest dues as
above are actually paid to the small enterprise, for the purpose of disallowance as a deductible
expenditure under section 23.

n) Sensitivity Analysis: Significant actuarial assumptions for the determination of the defined benefit
obligation are discount rate and expected salary increase rate. Effect of change in mortality rate is
negligible. Please note that the sensitivity analysis presented below may not be representative of the
actual change in the defined benefit obligation as it is unlikely that the change in assumption would
occur in isolation of one another as some of the assumptions may be correlated. The results of
sensitivity analysis are given below:

p) Defined Contribution Plans

Provident Fund for certain eligible employees is administered by the Company through Employees
Provident Fund as per the provisions of the Employees' Provident Funds and Miscellaneous
Provisions Act, 1952.

The amount contributed is recognized as an expense and included in "Company's contributions to
PF & other funds" of Statement of Profit and Loss account is Rs.57.18 lakhs (LY Rs.48.73 lakhs).

Notes

(a) The Estimates of future salary increases, considered in actuarial valuation takes account of
inflation, seniority, promotion and other relevant factors such as supply and demand in
employment market.

(b) Discount rate is based upon the market yields available on Government Bonds at the
accounting date with that of liabilities.

Note 31

Disclosure of under the Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received full information from vendors regarding their status under Micro,
Small and Medium Enterprises Development Act, 2006 (MSMED ACT); hence disclosure relating
to amount unpaid at year end together with interest paid/payable have been given based on the
information so far available with the Company / identified by the Company management. The
detail of the same is as under.

Note 35 Contingent Liabilities

a) Claims against the company not acknowledged as debt (In lakhs):

Demand under Central Excise act, 1944 and Finance act, 1944 for the period from 2003¬
04, against which appeal was filed before Commissioner appeal- Rs. 17.68 lakhs.

The case of excise pending in Tribunal involving an amount of Rs. 396.34 lakhs against
which Rs. 74.34 lakhs paid towards security deposit.

Cases of sales tax amounting to Rs. 115.42 lakhs are pending before Deputy
Commissioner of Commercial Tax and Rs. 137.04 lakhs from 2005-06 before Joint
Commissioner of sales tax.

In Income tax, an appeal has been filed by the department against relief granted by
income tax Appellate Tribunal which is pending in High Court, Calcutta-Rs. 640.78 lakhs for
1988-98. And Rs.316.97 lakhs case is pending before Commissioner (Appeal) for the period.

. The position of both the units (Hid Road & Budge Budge) has been handed over back to
KOPT along with the stocks which are having recoverable value more than the rent payable,
Since the matter is sub judice we have ignored the value of recoverable from the company has
provided for rent payable.

. On Account of LC and Bank Guarantee Rs 2,82,74,459/ - and 1,57,00,000/- respectively.

b) Capital and other commitments: Rs. Nil (Previous Year - Rs. Nil)

Note 36 Capital Management

The Company's objective when managing capital (defined as net debt and equity) are to
safeguard the Company's ability to continue as a going concern in order to provide returns to
shareholders and benefit for other stakeholders, while protecting and strengthening the
balance sheet through the appropriate balance of debt and equity funding. The Company
manages its capital structure and makes adjustments to it, in light of changes to economic
conditions and strategic objectives of the Company. The Company's capital management,
amongst other things, aims to ensure that it meets financial covenants attached to the interest¬
bearing loans and borrowings that define capital structure requirements. Breaches in meeting
the financial covenants would permit the bank to immediately call loans and borrowings.
There have been no breaches in the financial covenants of any interest-bearing loans and
borrowing in the current period.

Note 37

Since SASF has failed to issue NOC as stipulated in the scheme, the company has filed a
petition before the Hon'ble Calcutta High Court on the ground of breach of terms and
conditions of the scheme. The matter is pending before Hon'ble Calcutta High Court. The
matter for NOC with WBIDCL is being followed

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset
or liability, either directly (i.e.as prices) or indirectly (i.e., derived from prices)

Level 3 : Inputs for the asset or liability that are not based on observable market data
(unobservable inputs)

Note 40A

Balance confirmations are matched in respect of trade receivables and trade payables. In the
opinion of the management, it is unlikely that there will be any major reconciliation difference
with material impact on the carrying amounts of these assets and liabilities as reflected in
these financial statements.

Note 40B

As per NCLT Order, we purchased RCHEM Industries Pvt. Ltd. In consideration of Rs
3,01,25,000/- but the shares of the Company have not been transferred in the name of ARCL
Organics Ltd as on 31/03/2025. So that the M/s RCHEM Industries Pvt. Ltd. is not considered
a Subsidiary Company of ARCL Organics Ltd. In this regards the transferred value is shown
under Other Current Assets in Note no.-12.

Note 41 Finacial Risk Management

The Company's business activities are exposed to a variety of risks including liquidity risk,
credit risk, and market risk. The Company seeks to minimize the potential adverse effects of
these risks by managing them through a structured process of identification, assessment, and
prioritization of risks followed by coordinated efforts to monitor, minimize and mitigate the
impact of such risks on its financial performance and capital. For this purpose, the Company
has laid comprehensive risk assessment and minimization/mitigation procedures, which are
reviewed by the Audit Committee and approved by the Board from time to time. These
procedures are reviewed to ensure that executive management controls risks by way of a
properly defined framework. The Company does not enter into derivative financial

instruments for speculative purposes. The following table explains the sources of risk and
how the entity manages the risk in its financial statements. The management reviews the
status of all principal risks with a significant potential impact. Additionally, the Audit
Committee carried out focused risk reviews of its Plant and divisions. These reviews included
an analysis of both the principal risks and the controls, monitoring, and assurance processes
established to mitigate those risks to acceptable levels. As a result of these reviews, several
actions were identified to continue to improve internal controls and the management of risk.

a) Credit Risk

Credit Risk is the risk that the counterparty will not meet its obligations under a financial
instrument or customer contract leading to financial loss. The company is exposed to credit
risk from its operating activities (primarily trade receivables and deposits to landlords) and
from its financing activities, including deposits with banks and financial institutions, foreign
exchange transactions, and other financial instruments. The company generally doesn't have
collateral.

Customer credit risk is managed by business through the company's established policy,
procedures, and controls relating to customer credit risk management. The credit quality of
each customer is assessed and credit limits are defined in accordance with this assessment.
Outstanding customer receivables and security deposits are regularly monitored.

b) Market Risk

Market risk is the risk that the fair value of future cash flow of financial instruments may
fluctuate because of changes in market conditions. Market risk broadly comprises three types
of risks namely currency risk, interest rate risk, and price risk (for commodities or equity
instruments).

(i) Foreign Exchange Risk - The company operates only in India and has not entered into any
foreign exchange or commodity derivative contracts. Accordingly, there is no significant
exposure to market risk.

(ii) Interest Rate Risk -As a majority of the financial assets and liabilities of the Company are
fixed interest-bearing instruments, the Company's net exposure to interest risk is negligible.

(iii) Security Price Risk -. The company's exposure to securities price risk arises from
investments held by the company and classified in the balance sheet either as fair value
through OCI or fair value through Profit or Loss.

To manage the price risk arising from investments, the company diversifies its portfolio.
Diversification of a portfolio is done in accordance with the directions of the Board.

c) Liquidity risk

The company's objective is to at all times maintain the optimum level of liquidity to meet its
cash and collateral requirement at all times. The current committed lines of credit are sufficient
to meet its short to medium-term expansion needs and hence evaluate the concentration of
risk with respect to liquidity as low. The Company monitors rolling forecasts of its liquidity
requirements to ensure it has sufficient cash to meet operational needs while maintaining
headroom on its undrawn committed borrowing facilities at all times so that the Company
does not breach borrowing limits or covenants (where applicable) on any of its borrowing
facilities.

The company primarily depends on its own funds and has a low level of borrowing.

The table below summarises the maturity profile of the Company's financial liabilities based
on contractual undiscounted payments:

Note 44

(i) Company has used the borrowings from banks and financial institutions for the specific
purpose for which it was taken at the balance sheet date.

(ii) No proceedings have been initiated or pending against the company for holding any benami
property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made
thereunder and company has not been declared as willful defaulter by and bank or institution or
other lender.

(iii) To the best of the information available, the company has not entered into any transactions
with companies struck off under section 248 of the Companies Act, 2013 or section 560 of
Companies Act, 1956

(iv) Company has not traded or invested in Crypto currency or Virtual Currency during the
financial year

(v) 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 directly or indirectly lend or invest in other persons or entities indentified
in any manner whatsoever by or on behalf of the Funding party (ultimate beneficiaries); or
provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

(vi) No funds (which are material either individually or in the aggregate) have been advanced or
loaned or invested (either from borrowed funds or share premium or any other sources or kind
of funds) by the Company to or in any other person(s) or entity(ies), including foreign entity
("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the
Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities
identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries")
or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;