(e) Rights attached to equity share
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently other than loans from banks and financial institutions. The distribution of assets will be in proportion to the number of equity shares held by the shareholders.
The Company’s objectives of capital management is to maximize the shareholder value. The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants.
The Company monitors capital using a gearing ratio, which is net debt divided by total equity plus net debt as below. Equity includes equity share capital and all other equity components attributable to the equity holders
In order to achieve the objective of maximize shareholders value, the Company’s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing borrowings that define capital structure requirements. Any significant breach in meeting the financial covenants would allow the bank to call borrowings. There have been no breaches in the financial covenants of above-mentioned interest-bearing borrowing.
No changes were made in the objectives, policies or processes for managing capital during the current and previous years.
The Company operates defined gratuity plan for its employees. Under the plan, every employee who has completed atleast five years of service gets a gratuity on departure at 15 days of last drawn salary for each completed year of service. The scheme is funded with an insurance company in the form of qualifying insurance policy.
The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for gratuity.
The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied when calculating the defined benefit liability recognised in the balance sheet.
(i) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (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 group has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.
Note - 35 - Other Statutory Information
(a) Transactions and balances with companies which have been removed from register of Companies [struck off companies under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956.] as at the above reporting periods is Nil.
(b) The Company has not advanced or loaned or invested funds to any other person(s) or entity(is), including foreign entities (Intermediaries) with the understanding that the:
(i) 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
(ii) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(c) The Company has not received any fund from any person(s) or entity(is), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(i) 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
(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(d) The Company does not have any transaction which is not recorded in the books of accounts; and which has been surrendered or disclosed as income during the year in the tax assessments under the Income-tax Act, 1961.
(e) The Company has not granted any loans or advances in the nature of loans to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013), either severally or jointly with any other person.
Note - 36 - Events after the Reporting Period
There are no events occurring after the date of the Balance Sheet, which has a material effect on the accounts.
Note - 37 The Company operates in the textile industry, on the production and distribution of cotton goods.
Note - 38 Previous Year's figures have been regrouped / rearranged wherever considered appropriate to make them comparable with this period.
j) Contingent Liability
Particulars
31-03-2026 Amount in '
31-03-2025 Amount in '
Status
Demand raised by the Superintending Engineer, TNEB Trichy towards excess demand and energy charges for exceeding demand and energy quota during the period November 2008 to July 2009 paid by the Company
8,02,455
The Appellate Tribunal for Electricity has decided in favour of the Company. The Department has gone on an appeal to the Supreme Court. The Company is confident of obtaining the relief in the Supreme Court there by confident of getting refund of above amount paid included in "Security and Other Deposits"
E-Tax on Maximum demand charges levied by TANGEDCO
47,12,915
41,43,102
Interim Order was passed by the Supreme Court staying the procedure of levying E Tax on maximum demand charges on 12th October 2012 responding to the SLP filed by SIMA. SIMA and the Company is confident of getting favourable order. Hence no provision or payment has been made from October 2012.
Levy of Cross Subsidy Charges demanded by TANGEDCO vide a show cause notice dated 20th April 2017 for non fulfilling Captive Generating Status for the financials years 2014-15 to 2016-17
5,44,94,998
The High Court stayed TANGEDCO from taking any action as the demand was not maintenanble as per the Central Electricity Rules 2005 and based on the correspondences filed by the consumers. The Company is confident of obtaining complete relief and hence no provision is considered necessary.
Deemed demand charges levied by TANGEDCO for the units purchased from ARS Energy Pvt Limited under open access during the period August 2015 to October 2020.
1,24,38,041
The demand has been held in favour of TANGEDCO by Madurai Bench of Madras High Court. Based on the advice of TASMA, The Company has approached the Supreme Court. Based on the Supreme Court's direction, Company has approached Appellate Tribunal for Electricity. The Company is confident of getting relief and hence no provision is considered necessary.
Demand raised by Tamil Nadu Power Distribution Corporation Limited vide a show cause notice dated 24th December 2025 regarding implementation of DSM Regulations 2019 for non conventional gnerators/ open access power accounting for the year ended 31st March 2025
6,59,964
The Company has responded to the demand and pending final adjudication and assessment of the Company’s obligation, no provision is considered necessary.
GST Audit demand for the financial years 2018-19 to 2024-25 raised vide show cause notice
1,92,92,007
—
The Company has appealed and is confident of getting relief and hence no provision is considered necessary.
k) Dividend:
Company has not declared any dividend for the year.
l) Financial instruments - fair value measurement
a. Accounting classifications and fair values
The Company does not have any financial assets or financial liabilities whose fair value is different from its carrying amount.
m) Financial instruments - risk management
The Company has exposure to the following risks arising from financial instruments:
- credit risk (refer note (b) below)
- liquidity risk (refer note (c) below)
- market risk (refer note (d) below).
a. Risk management framework
The Company's board of directors has 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 faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's 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 obligations.
b. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers, loans to related parties and cash and cash equivalents.
The carrying amount of financial assets represents the maximum credit exposure.
(i) Cash and cash equivalents
The Company holds cash and cash equivalents of Rs. 8.01 Lakhs as at 31st March 2025. The cash and cash equivalents are mainly held with nationalised banks which have a very low risk of default.
c. Liquidity risk
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's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.
i) Financing arrangement
The Company had no undrawn borrowing facilities at the end of the reporting period.
d. Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, which will affect the Company's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.
i) Currency risk
Majority of the transactions entered into the company are denominated in INR. Accordingly, the company does not have any currency risk.
ii) Interest rate risk
The Company does not have any borrowings from external banks/agency and hence there are no interest rate risks.
n) The Company has not made any transactions with struck off Companies.