b) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having par value of '10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of Directors is subject to approval by the shareholders at the ensuing Annual General Meeting. In the event of liquidation, the shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion of their shareholdings.

c) Information regarding aggregate number of equity shares during the five years immediately preceding the date of Balance Sheet.

The Company has not issued for consideration other than cash and has not bought back any shares during the past five years.

The Company has not allotted any shares pursuant to contract without payment being received in cash.There are no calls unpaid on equity shares and no equity shares have been forfeited.

d) Capital Management

The primary objective of the Company's Capital management is to ensure that it maintains an efficient capital structure and healthy capital ratios to support its business and maximize shareholders value. The Company makes adjustments to its capital structure based on the business environments and its economic conditions.To maintain/ adjust the capital structure the company may make adjustments to dividend paid to its share holders and issue new shares.

The Company monitors capital using the metric of net debt to Equity. Net debt is defined as borrowing less cash and cash equivalents, fixed deposits.

Securities premium Reserve

Securities premium reserve is used to record the premium on issue of shares. The reserve is utilized in accordance with the provisions of the Act.

General Reserve

General Reserve is the retained earnings of the Company which are kept aside out of the Company's profits to meet future (Known or unknown) obligations.

Retained earnings

Retained earnings comprise of the Company's prior years undistributed earnings after taxes.

Distributions made and proposed

The Board of Directors of the Company in their meeting held on 2nd March 2021, declared an interim dividend of INR 6 (i.e. 60%) per equity share of Rs 10 each on the paid up equity share capital of the Company for the financial year ended 31 March 2021 amounting to Rs. 823 lakhs. The Board of Directors at its meeting held on 24th June, 2021 declared a final dividend of '4.00 (i.e. 40%) per equity share of the face value of '10 each for the financial year ended 31st March, 2021.The total dividend (interim and final dividend) for the financial year 2020-2021 of '10 (i.e. 100%) per equity share of the face value of '10 each.

The Board of Directors, at their meetings held on 27th January, 2022 declared an interim dividend of '5.00 (i.e. 50%) per equity share of the face value of '10 each. The Board of Directors at its meeting held on 19th May ,2022 have recommended a payment of final dividend of '5.00 (i.e. 50%) per equity share of the face value of '10 each for the financial year ended 31st March, 2022. If approved, the total dividend (interim and final dividend) for the financial year 2021-2022 will be '10 (i.e. 100%) per equity share of the face value of '10 each ('10.00 (i.e. 100%) per equity share of the face value of ' 10 each was paid as total dividend for the previous year).

Total dividend payout for the FY 2021-22 amounting to '1,371.96 lakhs) as against the total dividend of '10 (i.e. 100%) per equity share in the previous year (total dividend payout for the year FY 2020-21 amounting to '1371.96 lakhs)

Term Loan From Banks - Federal Bank, Axis Bank and HDFC bank. The term loan availed under Emergency Credit Line Guarantee Scheme(ECLGS) to meet the working capital needs under COVID 19 pandemic situation.

• The above loans are repayable in 60 months with 12 to 24 months moratorium and carries interest of 5.90% to 6.75%

• Regarding securities refer note no 17

• Vehicle Loan secured by Hypothecation of specific assets purchased out of the loans.

## 979.48 lakhs (281.99 lakhs) Fixed Deposit carry interest @7.5% (7.50%) and are repayable 2 years from the respective years.

2,683.56 lakhs (1,626.49 lakhs) Fixed Deposit carry interest @8 % (8.00%) and are repayable 3 years from the respective years.

• The Company availed un-secured loan from directors, which are repayable on demand and carries interest @ 6% p.a

The loan extended by banks are further collaterally secured by equitable mortgage of Company's properties in the case of HDFC Bank properties at Trichy, Tuticorin, Madurai, Ramnad and in the case of Karur Vysya Bank property at Oppanakara Street at Coimbatore, and in the case of Axis Bank property at Bazaar Street, Salem and in the case of Yes Bank property at Alwarpurm and in the case Federal Bank property at Nethaji Road and Solanguruni at Madurai.

Security for Tamilnadu Mercantile Bank property at Madurai owned by Managing Director of the Company and for Axis Bank loan secured by whole time directors properties at Madurai.

• 5.97% (5,46,220 shares) promoters share holding in the company has been pledged as collateral security for IDBI loan.

• 3.28% (3,00,000 shares) promoters share holding in the company has been pledged as collateral security for Yes bank loan.

• 5.53% (5,05,560 shares) promoters share holding in the company has been pledged as collateral security for Federal Bank loan.

Gold Metal loan from Banks against Fixed deposit of the respective bank.

All the above mentioned collateral securities owned by the company and by the respective whole time directors are given to the respective banks as indicated above are given on exclusive basis and not on a pari passu charge basis and also is in accordance with sanction terms and conditions of the respective banks.

All the above loans are further secured by personal guarantee of whole time of directors of the company.

The cash credit is repayable on demand and carries interest of 6.20% to 10.00% p.a.

The Gold Metal Loan carries interest @ 1.90% to 3.00% p.a.

b. An order for demand of less payment of Customs duty on imported goods pertaining to earlier year for '154 Lakhs passed by principal Commissioner of Customs, Chennai. The company has moved a Writ petition against the order with Honourable High Court of Madras for quashing the order passed by the Authority. The writ was admitted, and status quo is maintained. Direction given by High court of Madras to approach Appellate Tribunal / Commissioner (Appeals) to complete the appeals. The company is advised that it has got a more than a reasonable chance for success and therefore no provision is made in the books. Hence, this liability if any is considered as contingent in nature.

c. In respect of - outstanding Letter Credit given to bankers ' Nil (previous year ' Nil Lakhs)

d. The Commercial Tax office, Madurai has issued a notice for the Asst year 2006 -07 to 2012-13 on the matter of payment of Sec 12 purchase tax and others made a claim aggregating to '492 Lakhs. The notice is erroneous as the law permits to adjust the excess input credit available at every point of time with that of purchase tax payable. The company even after adjusting regularly the purchase tax due with the excess input credit available has also paid by remittances for balance if any. Accordingly, at no point of time, the company failed to pay purchase tax u/s 12. Against this frivolous notice, the company took the matter to Honourable Madras High Court, Madurai bench and obtained stay and also restrained the authorities to pass any orders without the court direction.

However, commercial tax officer has passed order to nullify demand amount of '436 lakhs as on 5th March 2020. The balance amount of '56 lakhs company has proposed appeal with Appellate Authorities at Madurai. Hence, the liability if any is considered as Contingent in nature.

e. The Company has received demand notice from the income tax department amounting to ' 590.59 lakhs for the year 2016-17 and ' 857.59 lakhs for the year 2017-2018 related to dispute of wastage treatment in the books of accounts from the assessing officer, as per order under Section 143 (2) of the Income Tax Act ,1961. Company is in appeal before Commissioner of Appeals against said order. This dispute arises on account of wrongful understanding of the accounting of wastage in production by the assessing officer. Though the facts so obvious and consistently followed by the company and obtained orders in the earlier years as per same submissions made. The company is advised that it has got a more than a reasonable chance for success and therefore no provision is made in the books. Hence, this liability if any is considered as contingent in nature.

f. Show-cause notice was received under Section 11A(4) of the Central Excise Act, 1944 from Directorate General of GST Intelligence, Coimbatore Zonal Unit, Coimbatore relating to non-payment of Central excise duty on for Sale of branded gold coins amounting to '715.90 lakhs and Sale of silver jewellery amounting to '391.35 lakhs and dispute on input service tax credit amounting to '145.45 lakhs aggregating to '1252.70 lakhs for the period from 01.03.2016 to

30.06.2017. The company is waiting for a personal hearing with the Additional Director General (Adjudication), DGGI, Mumbai and the outcome of the case is still awaited.

The company is of the view that with the submissions made to the authorities, it will come out of the legal tangle, and hence no provision is made in the books of account. And hence, this liability if any is considered as contingent in nature.

Note 36 - Segment Report

The company is engaged in the business of Gold Jewellery, Diamond and Silver Articles, which constitutes a single business segment. In view of the above, there are no segment wise reports to be disclosed in terms of Indian Accounting Standard (Ind AS) 108- "Segment Reporting" issued by The Institute of Chartered Accountants of India

Provision for gratuity fund of ' 213.93 lakhs (Previous year ' 182.19lakhs) being the net liability recognized as per actuarial valuation of gratuity fund.

The expected rate of return on plan assets is based on market expectation, at the beginning of the year, for returns over the entire life of the related obligation.

The assumption of future salary increase, are considered in actuarial valuation, taking into account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

Investment Details

The company made annual contributions to the Employee Group Gratuity Trust based on the actuarial valuation. The said Trust is in the process of making investment of Gratuity Fund through Life Insurance Corporation of India according to guidelines of IRDA.

The company is collecting advances from customers both in the form of gold and money and no value addition is charged as per terms of agreement at the time of sale of ornaments. The liability for receipt of customer advances in this category is accounted as and when received by the company. At the time of redemption entire value addition will be given as discount to the customers and no provision for such future discount is made in the accounts in accordance with the significant accounting policies of the company as the real time sale is contingent on redemption. A sum of '14,255.10 lakhs (Previous year ' 12,427.68 lakhs) is outstanding in such scheme as on 31st March 2022. The discount if any payable in future on redemption will be treated as reduction in sales realization.

During the year a survey was conducted by The Assistant Commissioner of Customs, Customs Preventive Unit, Madurai at the manufacturing units and purchase premises of the company. Gold Coin weighing 1643 grams was taken over by the official under the protest of certain scratches appeared in the items and also reflecting foreign origin of the items. By virtue of accepting coins from customers after taking due declaration, the company scratches a different point of time accepted the coin that fulfilled purity and other regulatory essentials. The company has received notice from the department and appeared to the Appropriate Authority and produced necessary documents and explanation. The company is of the view that with the submissions made to the authorities, it will come out of the legal tangle, and hence no provision is made in the books of account. The above said quantity was included in the closing stock as of 31st March 2022.

In the opinion of the management, there is no impairment in the carrying cost of fixed assets of the Company in terms of the Indian Accounting Standard (Ind AS) 36 "Impairment of Assets" issued by the Institute of Chartered Accountants of India except Impairment assets value of 'Nil lakhs (previous year '33.35 lakhs).

Note 41

The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.

Note 42 - Financial Risk Management Framework

The Company is exposed predominantly to liquidity risk and market risk which may adversely impact the fair value of its financial instruments. The company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company. The risks and mitigating actions are also placed before the Audit Committee of the Company.

Liquidity Risk

Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities when due without incurring unacceptable losses.

The company maintained a cautious liquidity strategy, with a positive cash balance throughout the year ended 31st March. Cash flow from operating activities provides the funds to service the financial liabilities on a day to day basis. The company regularly monitors the rolling forecasts to ensure it has sufficient cash on an on- going basis to meet operational requirements. Any short term surplus cash generated, over and above the amount required for working capital management and other operational needs, is retained as undrawn from limits (to the extent required) to ensuring sufficient liquidity to meet liabilities. The company expects to meet it their obligations from operating cash flows.

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 places. Market risk comprises two types of risk: Interest rate risk, and price risk. Financial instruments affected by market risk include loans and borrowings and deposits.

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. This risk exists mainly on account of borrowing of the Company. However, all these borrowings are at flexible interest rate and based on the limit availment and hence the exposure to change in interest rate is insignificant in the current syndrome.

Price risk

Gold price fluctuation risk could arise on account of frequent changes in gold prices either up or downside momentum. It could have adverse impact on earnings. We are maintaining our inventory price hedging around 72:28 basis. This will help the company with any gold price fluctuation. Your Board will take appropriate action in managing the fluctuation impact in gold price movement from time to time to increase to 75:25 basis.

Risk due to outbreak of COVID 19 pandemic

The Company has taken into account external and internal information for assessing possible impact of COVID-19 on various elements of its Financial Statements, including recoverability of its assets.

Estimation uncertainty relating to the global health pandemic on COVID-I9

The Company has considered the possible effects that may result from the pandemic relating to COVID 19 on the financial results of the company. In developing the assumptions relating to the possible future uncertainties in the global economic conditions because of this pandemic, the company as at the date of approval of these financial results has used internal and external sources of information. The company has performed an analysis on the assumptions used and based on current estimates expects the carrying amount of its assets will be recovered. The Company has made detailed assessments of its liquidity position for the next one year and of the recoverability and carrying values of its assets comprising property, plant and equipment, inventories, receivables and other current assets as at the balance sheet date and on the basis of evaluation based on the current estimates has concluded that no material adjustments as required in the financial results. The impact of COVID-19 on the Company's financial results may differ from that estimated as at the date of approval of these financial statements.

Earnings Available for debt service**

**Net Profit after taxes Non cash operating expenses Interest Other adjustments @the reduction due to reduction of inventory profit for the FY 2022

Capital Management

For the purpose of the Company capital management, capital includes issued equity capital and other equity reserve attributable to the equity share holders of the Company. The primary objective of the company's capital management is to maximise the shareholder value.

The company manages its capital so as to safeguard its ability to continue as a going concern and to optimise returns to shareholders. The capital structure of the Company is based on management's judgement of its strategic and day to day need with a focus on total equity so as to maintain investor, creditors and market confidence.

All figures have been rounded off to the nearest rupees in thousands.

Previous year figures have been regrouped / reclassified to make them comparable with that current year.