2.15 Provisions, Contingent Liabilities and Contingent Assets
Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, and it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate
can be made of the amount of the obligation.

When the effect of the time value of money is material, the Company determines the level of provision by discounting the expected
future cash flows to net present value using an appropriate pre-tax discount rate that reflects current market assessments of the time
value of money and, where appropriate, the risks specific to the liability.

Contingent Assets / Liabilities

A contingent liability is a present obligation that arises from past events, where it is either not probable that an outflow of resources
will be required to settle or a reliable estimate of the amount cannot be made. A contingent liability is disclosed. Contingent
liabilities are also disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company.

Claims against the Company, where the possibility of any outflow of resources in settlement is remote, are not disclosed as contin¬
gent liabilities.

Contingent assets are not recognised in the Standalone Financial Statements since this may result in the recognition of income that
may never be realised. A Contingent asset is disclosed where an inflow of economic benefits is probable.

2.16. Recent Accounting Pronouncements

The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standards) Third Amendment Rules 2024, dated 28th
September 2024, to amend the following Ind AS which is effective from 30th September 2024.

Amendment to Ind AS 104

An insurer or insurance company may provide its financial statement as per Ind AS 104 for the purposes of consolidated financial
statements by its parent or investor or venturer till the Insurance Regulatory and Development Authority notifies the Ind AS 117 and
for this purpose, Ind AS 104 shall, as specified in the Schedule to these rules, continue to apply.

The said amendment is not applicable to the Company and accordingly, has no impact on the Company's financial statements.

The disclosure given herein above has been made on the basis mentioned in Note No. 47(c), 47(d), 52 and 54. The default and amount due are
therefore subject to confirmation and reconciliation with respective parties and on resolution of the company's borrowing under consideration by
lenders as stated.

Certain payments made by body corporates on behalf of the Company amounting to Rs. 1,98,680 (Rs. in thousands) against settlement made by
them for repayment of loans taken by the Company has been disclosed as unsecured loans repayble on demand. Pending finalisation of terms and
conditions with respect to these loans, necessary disclosures in this respect have not been made in these financial statements.

Nature and Purpose of Reserves:

Retained Earnings:

The Retained earnings comprises of General Reserve and Surplus which is used from time to time to transfer profits by appropriations. It is a free
reserve of the Company and can be utilised in accordance with the provisions of the Companies Act, 2013 and as per the approval of the Board. It
includes the remeasurement of defined benefit plans as per actuarial valuations which will not be reclassified to the Standalone Statement of Profit
and Loss in subsequent periods.

Statutory Reserve:

Statutory Reserve represents the reserve created pursuant to the Reserve Bank of India Act, 1934 ("the RBI Act"). In terms of section 45-IC of the RBI
Act, a Non-Banking Finance Company is required to transfer an amount not less than 20 per cent of its net profit to a Reserve Fund before declaring
any dividend. Appropriation from this Reserve Fund is permitted only for the purposes specified by RBI.

Capital Reserve:

Capital Reserve was created through business combinations and shall be utilised as per the provisions of the Companies Act, 2013.

Fair value of Equity Instruments through Other Comprehensive Income:

This reserve represents the cumulative effect of fair value fluctuations of Investments made by the Company in equity instruments of other entities.
The cumulative gain or loss arising on such changes are recognised through Other Comprehensive Income (OCI) and is accumulated under this
reserve. The amount from this reserve will not be reclassified to the Standalone Statement of Profit and Loss in subsequent periods.

Notes:

i. Representing claim in respect of Interest on Excise Duty pending before the Hon'ble High Court at Chennai.

ii. Representing demand as per Order issued by the Commissioner of Service Tax, Kolkata in respect of various service tax matters.
The above includes penalty and interest for delayed payment of the taxes which have not been quantified in the Order.

B) Other commitments

i. The Company has given an undertaking to ICICI Bank Limited not to transfer, assign, dispose of, pledge, charge or create any
lien or in any way dispose of the existing Equity Shares to the extent of 13,04,748 shares or future shareholdings in McNally
Bharat Engineering Company Limited without prior approval of the bank.

ii. In the matter of InCred Financial Services Limited (formely KKR Financial Service Private Limited), the Company has been
restrained from selling, transferring, alienating, disposing, assigning, dealing or encumbering or creating third party rights on
their assets of the Company vide ex-parte, interim order passed by Hon'ble High Court of Delhi in O.M.P. (I) (COMM.) 459/ 2019
dated 13th December, 2019.

Note 33

Balance Confirmation

Certain debit and credit balances including trade and other receivables, loans, other financial and non-financial assets, trade and
other payables, debt securities and borrowings, and other financial and non-financial liabilities are subject to reconciliation with
individual details and balances and confirmation thereof. Adjustments/ impact and related disclosures including those relating to
MSME and interest thereagainst if any payable in this respect are currently not ascertainable.

Note 34

Earnings Per Share (EPS)

Net Profit for the year has been used as the numerator and number of shares have been used as denominator for calculating the
basic and diluted earnings per share.

Note 37

Capital Management

The primary objective of the Company's capital management policy is to ensure that the Company complies with externally imposed
capital requirements and maintains strong credit ratings and healthy capital ratios in order to support its business and to maximize
shareholder's value.

The Company manages its capital structure and makes adjustments thereto in light of changes in economic conditions and require¬
ments of the financial covenants. In order to maintain or adjust the capital structure, the Company may adjust the amount of
dividend payment to shareholders, return capital to shareholders or issue capital securities. No changes have been made to the
objectives, policies and processes from the previous years. However, they are under constant review by the Board.

Level 1 hierarchy includes financial instruments valued using quoted market prices. Listed equity instruments and traded debt
instruments which are traded in the stock exchanges are valued using the closing price at the reporting date.

Level 2 hierarchy includes financial instruments that are not traded in active market. This includes OTC derivatives and debt instru¬
ments valued using observable market data such as yield etc. of similar instruments traded in active market. All derivatives are
reported at discounted values hence are included in level 2. Borrowings have been fair valued using market rate prevailing as on the
reporting date.

Level 3 if one or more significant inputs is not based on observable market data, the instrument is included in level 3. This is the case
for unlisted equity instruments and certain debt instruments which are valued using assumptions from market participants.

iii. Valuation techniques used for valuation of instruments categorized as level 3.

For valuation of investments in equity shares and associates which are unquoted, peer comparison has been performed wherever
available. Valuation has been primarily done based on the cost approach wherein the net worth of the Company is considered and
price to book multiple is used to arrive at the fair value. In cases where income approach was feasible valuation has been arrived
using the earnings capitalization method. For inputs that are not observable for these instruments, certain assumptions are made
based on available information. The most significant of these assumptions are the discount rate and credit spreads used in the
valuation process. For valuation of investments in debt securities categorized as level 3, market polls which represent indicative
yields are used as assumptions by market participants when pricing the asset.

Note 39

The Company has a process whereby periodically all long-term contracts are assessed for material foreseeable losses. At the year
end, the Company did not have any long-term contracts including derivative contracts for which there were any material foresee¬
able losses details whereof need to be provided under any law / Indian Accounting Standards.

Note 40

Financial Risk Management

The Company has operations in India. Whilst risk is inherent in the Company's activities, it is managed through a risk management
framework, including on-going identification, measurement and monitoring subject to risk limits and other controls. The Company's
activities expose it to credit risk, liquidity risk and market risk.

This note explains the sources of risk which the Company is exposed to and how the entity manages the risk.

Disputed and defaulted liability have been considered as due within 12 months in compliance with Ind AS 1: Presentation of
Financial Statements.

a) Interest rate risk

The Company holds shorter duration investment portfolio and thus it has a minimum fair value change impact on its
investment portfolio. The interest rate risk on the investment portfolio and corresponding fair value change impact is
monitored.

On assets and liabilities

Interest rate sensitivity on fixed and floating rate assets and liabilities with differing maturity profiles is measured by using
the duration gap analysis. The same is computed monthly and sensitivity of the market value of equity assuming varied
changes in interest rates are presented and monitored by ALCO.

b) Price risk

Company's equity investments carry a risk of change in prices. To manage its price risk arising from investments in equity
securities, Company periodically monitors the sectors it has invested in, performance of the investee companies,
measures mark-to-market gains/losses and reviews the same.

c) Credit Risk

Credit risk is the risk of financial loss arising out of a customer or counterparty failing to meet their repayment obligations
to the Company. It has a diversified lending model and focuses on commercial lending.

Classification of financial assets under various stages

The Company classifies its financial assets in three stages having the following characteristics

Stage 1: unimpaired and without significant increase in credit risk since initial recognition on which a 12-months allowance for ECL
is recognized;

Stage 2: a significant increase in credit risk since initial recognition on which a lifetime ECL is recognized; and

Stage 3: objective evidence of impairment and are therefore considered to be in default or otherwise credit impaired on which a
lifetime ECL is recognized.

Unless identified at an earlier stage, all financial assets are deemed to have suffered a significant increase in credit risk when they are
30 days past due (DPD) or one installment overdue on the reporting date and are accordingly transferred from stage 1 to stage 2. For
stage 1 an ECL allowance is calculated based on a 12-months Point in Time (PIT) probability weighted probability of default (PD). For
stage 2 and 3 assets a life time ECL is calculated based on a lifetime PD.

The Company has calculated ECL using three main components: PD, LGD (loss given default) and EAD (exposure at default) along
with an adjustment considering forward macro-economic conditions.

The Company had received an order passed by the Reserve Bank of India ("RBI") for cancellation of Certificate of Registration (No.
05.05534 dated March 31,2003) vide letter no. KOL.DOS.RSG.No.S949/03.03.008/2022-23 dated July 04, 2022 under Section 45-IA(7)
of the Reserve Bank of India Act, 1934. The RBI had also instructed the Company to follow RBI Norms until the NBFC operations are
ceased by the company.

The Company had filed a petition with the Appellate Authority of NBFC Registration for the restoration of the Certificate of
Registration. The Appellate Authority has rejected the petition and passed the final order dated May 04, 2023 for cancellation of
Registration. Further, a Writ Petition before the Calcutta High Court has been filed by the Company for restoration of the licence and
the matter is subjudice.

The Standalone Financial Statements of the Company for the year ended 31st March, 2025 have been prepared considering the
prudential norms applicable to the Non-Banking Financial Company.

Note 44

The main business of the Company is Investment activity; hence, there are no separate reportable segments as per Ind AS 108 on
'Operating Segment.

Note 45

Based on Master Direction - Reserve Bank of India (Non-Banking Financial Company - Scale Based Regulation) Directions, 2023
dated 19th October,2023 provisions are made for standard assets at 0.25 percent of the balance of such assets as at 31st March, 2025
which has been disclosed separately as "Provision for Standard Assets" in Note 19.

During the year, the Company's financial performance has been adversely affected due to external factors beyond the control of the
Company due to the classification of loans and advances as Non-Performing Assets and diminution in the value of Investments
resulting in negative net worth. The Company has defaulted in repayment of its loans due to the liquidity issues faced by the Compa¬
ny. However, the management is having constant negotiations and discussions with the lenders for early settlement of disputes and
are confident that with the lenders' support and various other measures taken by it, the Company will be able to generate sufficient
cash inflows through profitable operations improving its net working capital position to discharge its current and non-current
financial obligations. Accordingly, the Board of Directors have decided to prepare the Standalone Financial Statements on a going
concern basis.

Note 47

a) The Company has requested the Inter-Corporate lenders to consider the waiver of interest for the current financial year which
is yet to be confirmed. Accordingly, interest expense of Rs. 4,64,188 thousand on inter-corporate borrowings for the year
ended 31st March, 2025 (Rs. 4,24,354 thousand for the year ended 31st March, 2024) has not been recognized in the Stand¬
alone Financial Statements.

b) The Company is in disputes with the secured lenders, namely HDFC Bank Limited and InCred Financial Services Limited
(formerly KKR Financial Services Limited), and accordingly, the Board of Directors has decided not to recognize interest on such
borrowings for the current year in the Standalone Financial Statements as the same is not ascertainable at present.

c) In earlier years, the Company could not repay the term loan due to InCred Financial Services Limited (formerly KKR Financial
Services Limited). The matter has been referred to Arbitration.

d) A lender of the Company, namely HDFC Bank Limited, has filed a suit before the Honorable High Court at Calcutta against the
Company and its Group Company for default in repayment of loans borrowed by the Company. The Company has decided to
contest and defend its case.

Note 48

The company had defaulted in redemption of Non-Convertible Debentures (NCD). Consequently, the debenture holder and/or
debenture trustee have invoked various shares and securities given by the company and its group companies. In the absence of any
invocation statement and/or confirmation from IL&FS, the company has adjusted the value of NCD and interest thereon from such
invocation at the closing market price of the said shares on the date of invocation, the details of which are given here under:

As on 31st March, 2025, the Company has four directors namely, Mr. Lakshman Singh, Mr. Chandan Mitra, Mr Debashis Lahiri and Ms.
Lyla Cherian who are disqualified under section 164(2)(b) of the Companies Act, 2013. The disqualification of the Directors of the
Company have occurred pursuant to default in repayment of principal amount of Non-Convertible Debentures and payment of
interest amount of Non-Convertible Debentures.

Note 50

In earlier years, the Company had issued Non-Convertible Debentures worth 10,00,000 thousand to IL & FS which matured at the end
of the Financial Year 2022-23. The company defaulted in repayment of the dues, consequently invocations were made from
time-to-time by the debenture trustee towards recovery of its dues.

One-time settlement agreement dated 5th May, 2023 has been signed by the Debenture-holder, the Company and Guarantors
along with other borrowers. According to the MoU, the Company and other borrowers had settled their respective liability towards
debt securities in part for cash consideration of Rs. 4,96,700 thousand which was paid by a group company on behalf of the company
and other borrowers and the balance is to be settled by selling the collateral Neemrana Land, jointly owned by Vedica Sanjeevani
Projects Private Limited and Christopher Estates Private Limited by the end of the year. The proceeds from the sale of Neemrana Land
shall be adjusted to settle the outstanding dues only on Final Settlement Date in the manner as may be communicated by the
Debenture holder in writing. However, the sale of Neemrana Land has not yet been materialized. The necessary accounting
adjustments, if any, will be carried out upon completion of the sale and subsequent communication with the respective lenders.

Note 51

In the earlier years, Kotak Mahindra Bank Limited ("KMBL") had agreed to invest in Compulsory Convertible Preference Shares
("CCPS") of McNally Bharat Engineering Limited ("MBECL") to the tune of Rs. 1,44,800 thousand and the Company had entered into a
Share Subscription Shareholder's Agreement along with a Put Option Agreement with KMBL. As per the terms of agreement KMBL
exercised put option to sell the said shares to the Company. On its failure to recover the amount, KMBL filed an application under
section 9 of Arbitration & Conciliation Act before the Bombay High Court. An order of injunction was passed upon the Company
restraining it from transferring, disposing of or alienating its assets and an undertaking was taken from the company that Rs. 5,000
thousand would be paid by it upfront which has since been paid.

The CCPS liability of Rs. 1,48,800 thousand has been settled for an amount of Rs. 63,000 thousand vide a settlement agreement dated
26th December, 2023. As per the mentioned terms, Fixed Deposit of Rs. 8,000 thousand in KMBL have been encashed and adjusted
and all payments have been made. The outstanding liability has been fully settled. The Company is yet to receive a No Due Certificate
from KMBL.

Note 52

In the earlier years, the company had settled and accounted for a term loan of Rs. 6,00,000 thousand at Rs. 4,79,108 thousand given
by SREI as per MoU entered between borrower, lender and guarantors on 28.09.2020. However, the Company has defaulted/delayed
the payment as per terms and conditions of the MoU. In the matter, the Company entered into a debt restructuring agreement for
the balance Rs. 1,20,000 thousand payable in monthly instalments which was acknowledged as debt by the Company and necessary
expense been recorded and guaranteed by Mr. Aditya Khaitan, Promoter of the Company. However, as on 31st March 2025, the
Company has not paid Rs. 16,947 thousand (including interest) due for the month of February 2025 and March 2025. Subsequently,
the Company has paid Rs. 5,500 thousand for the dues of February 2025 in April 2025.

Note 53

In earlier year, pursuant to the put option agreement entered into by the Company with Aditya Birla Finance Limited ("the Investor"),
the Investor had invested in one of the promoter group company namely McNally Bharat Engineering Company Limited (MBECL) by
subscribing to 1,12,90,000 Compulsorily Convertible Preference Shares (CCPS) @ Rs 62/- per CCPS aggregating to Rs. 6,99,980
thousand. On the Investor's failure to realize the amount on exercising the put option, it initiated arbitration proceedings and the
Arbitral Tribunal passed an interim award upon the group companies and the Company declaring it to be jointly and severally liable
to pay a sum of Rs. 8,10,000 thousand. The Company filed an application challenging the award and the adjudication order dated
7th June, 2023 has been passed by the Arbitrator.

As per the order and the consent terms agreed, in the current year, the group companies have paid a sum of Rs. 34,400 thousand
during the year. The Company has recognized the liability in the name of group companies under the head 'Borrowings other than
Debt Securities' in Note No. 16 with the corresponding charge to Statement of Profit & Loss under the head 'Other Expenses' in Note
No. 29.

Note 54

In the earlier year, one of the lenders of the Company, Aryan Mining and Trading Corporation Private Limited had assigned its
receivable from the Company to Danta Vyapar Kendra Limited amounting to Rs. 38,392 thousand. The Company has defaulted in the
payment of Rs. 41,874 thousand) including interest thereon) due as on 31st March, 2025.

In the earlier years, the company had given Inter Corporate Loans and Advances to McNally Bharat Engineering Company Limited
(MBECL). On 29th April 2022 National Company Law Tribunal (NCLT) Kolkata Branch II has passed the order against MBECL for
initiation of the Corporate Insolvency Resolution Process (CIRP) as per the provision of the Insolvency Bankruptcy Code, 2016. The
company had filed its claim of Rs. 15,96,621 thousand before the Interim Resolution Professional (IRP) of MBECL. The Resolution
Professional (RP) had admitted the Claim to the extent of the principal amounting to Rs. 1,30,000 thousand only. The Resolution Plan
has been approved by NCLT on 19th December 2023 but is not effective till the payment is made by the Resolution Applicant.
However, the Company has already made provisions against the Inter-corporate deposit given and its interest of Rs. 15,01,338
thousand. Further, the Company's investment in MBECL, being a promoter shareholder, are locked for trading. Therefore, in
accordance with Ind AS 113 Fair Value Measurement and as per the resolution plan, Investment in equity instruments of MBECL has
been valued at Rs. Nil thousand.

Note 56

In earlier year, upon exercise of put option by IL&FS Financial Services Limited for loan extended to McNally Bharat Engineering
Company Limited by subscribing 1,61,29,000 CCPS issued by said group company @ Rs. 62/- per CCPS, amounting to Rs. 9,99,988
thousands the Company recognized the liability to that extent and showed as receivable from McNally Bharat Engineering Company
Limited as 'Other Receivable' in Note 6.

Note 57

An Adjudicating Order No. Order/SV/VC/2024-25/30271 dated 10th April, 2024 was passed by SEBI Adjudicating Officer imposing a
penalty of Rs. 200 thousands. The same has been paid during the year and disclosed as 'Other Expenses' in Note 29.

Note 58

Corporate Social Responsibility

As per section 135 of the Companies Act, 2013 a company, meeting the applicability threshold, needs to spend at least 2% of its
average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. In terms of
the requirement of section 135 of the Companies Act, 2013 and rules made thereunder, the Company was not required to spend on
CSR activities during the Financial Year ended 31st March, 2025 since the Company had an average net loss during the immediately
preceding Financial Year.

Note 59

Additional Regulatory Information

The following additional disclosures are made pursuant to notification of Ministry of Corporate Affairs dated 24th March, 2021.

a. 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 rules made thereunder.

b. None of the banks, financial institutions or other lenders from whom the company has borrowed funds has declared the
company as a wilful defaulter at any time during the current year or in previous year.

c. Details of Transaction with the companies struck off under section 248 of Companies Act, 2013 or section 560 of the
Companies Act, 1956 are as follows:

e. The Company does not have any investment in subsidiary companies and accordingly the disclosures as to whether the
company has complied with the number of layers of companies prescribed under clause (87) of section 2 of the Act read with
the Companies (Restriction on number of Layers) Rules, 2017 is not applicable.

f. All the borrowings from banks and financial institutions have been used for the specific purposes for which they have been
obtained.

g. Utilization of Borrowed Funds and Share Premium

i. The Company has not advanced or loaned or invested funds to any other persons or entities, including foreign entities
(Intermediaries) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall 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 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 persons or entities, 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 identified 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.

h. The Company has not taken any working capital facilities from banks on the basis of security of current assets.

i. There were no transactions which have not been recorded in the books of account, have been surrendered or disclosed as
income in the tax assessments under the Income Tax Act, 1961 (43 of 1961) during the year.

Signature to Notes 1 to 60

As per our report of even date For and on behalf of the Board of Directors

For V. Singhi & Associates Ashim Kumar Mookherjee L opamudra Chatterjee

CharteredAccountants (Director) (Director)

Firm Registration No:3H017E DIN: 10890238 DIN: 10818895

(A. SENGUPTA)

Partner

Membership ^No^: 051371 Sk JavedAkhtar Sudipta Chakraborty

(Company Secretary) (Manager and CFO)

Place: Kolkata ^ACS 24637

Date: