Term Loans From Bank:

- Punjab National Bank: Secured Loan of Rs, 9,62,35,394/- (Rupees Nine Crore Sixty Two Lac Thirty Five Thousand Three Hundred Ninety Four) (Previous Year Rs, 12,37,50,224/- (Rupees Twelve Crore Thirty Seven Lac Fifty Thousand Two Hundred Twenty Four Only) secured through exclusive Charge on Fixed Assets Block, situated at F-5, Kishangarh Rajiv Gandhi I.T. Park, Chandigarh. Due within one year is Rs, 3.75 Crore (Rupees Three Crore Seventy Five Lac Only ) (Previous Year Rs, 3.50 Crore (Rupees Three Crore Fifty Lac Only). The loan has been guaranteed by Mr. Kanwar Deep Singh in the capacity of the director till 31^st August,2012 and thereafter being the promoter of the company. Term Loan carries interest @ base rate 4% and is repayable in 84 monthly installment of Rs, 25,00,000/- (Rupees Twenty Five Lac Only) each, commencing from 30^th April, 2013.

Vehicle Loans from Bank:

- Vehicle Loans of Rs, 14,85,795/- (Rupees Fourteen Lac Eighty Five Thousand Seven Hundred Ninety Five Only) (Previous Year Rs, 53,65,663/- (Rupees Fifty Three Lac Sixty Five Thousand Six Hundred Sixty Three Only) are Secured against hypothecation of vehicles. Due within one year is Rs, 7,93,370/- (Rupees Seven Lac Ninety Three Thousand Three Hundred Seventy Only) (Previous year Rs, 34,12,789/- (Rupees Thirty Four Lac Twelve Thousand Seven Hundred Eighty Nine Only). Vehicle Loans have been procured from various banks with rates of interest varying from 9% to 12% with repayment term of 3 to 5 Years.

Inter Corporate Loan:

- Inter Corporate loan has been received from KDS Corporation Pvt Limited (a promoter group Company) and Technology Park Limited (a party covered under section 189 of the Companies Act. 2013) amounting to Rs, 30.01 Crores and Rs, 683.10 Crores. The Terms of repayment with respect to loan from KDS Corporation Private Limited have not been defined and is repayable on the mutual agreement of both the parties involved, hence terms are not prejudicial to the interest of the company. Loan from Technology Park Limited is repayable on service of a minimum notice of 12 months by the lender for a repayment in excess of Rs, 50.00 Crores, however upon the concurrence of the Company, hence terms are not prejudicial to the interest of the Company. The Inter Corporate Loans obtained by the Company are non interest bearing.

Loan Repayable on demand, from Banks

- Bank of India:

Working Capital facility of Rs, 3,60,09,389/- (Rupees Three Crore Sixty Lac Nine Thousand Three Hundred Eighty Nine Only) (Previous Year Rs, 3,31,97,767/- (Rupees Three Crore Thirty One Lac Ninety Seven Thousand Seven Hundred Sixty Seven Only) secured against hypothecation of stocks and book debt of the companyRs,s unit located at Chambaghat, Solan (H.P). It is further collaterally secured by Land and Building, other structures (erected or to be erected) and other immovable properties of the Unit situated at Chambaghat, Solan.

The loan has been guaranteed by Mr. Kanwar Deep Singh in the capacity of the director till 31^st August, 2012 and thereafter being the promoter of the company.

* Refer Note No. 4 ** Refer Note No. 49

*** A sum of Rs, 37,40,367/- (Rupees Thirty Seven Lac Forty Thousand Three Hundred Sixty Seven Only) (Previous year Rs, 48,20,164/- (Rupees Forty Eight Lac Twenty Thousand One Hundred Sixty Four Only) is lying as unclaimed dividend in separate accounts with HDFC Bank and YES Bank, Chandigarh.

1. In the opinion of the management the current assets, loans and advances are of the value stated, if realized in the ordinary course of business. Out of the total amount of Loan and Advances a Sum of Rs, 4.60 Crores stands outstanding from Medisphare Marketing Limited. The company has initiated a legal action in the Kolkata High Court for recovery of the same.

2. The Company had entered into a scheme of arrangement under section 391-394 of the Companies Act, 1956 with Alchemist Foods Limited, a wholly owned subsidary which had been approved by the Hon'ble High Court of Delhi and High Court of Punjab and Haryana at Chandigarh vide its order dated 1^st November, 2010 & 2^nd December, 2010 respectively. The same had been registered with the Office of Registrar of Companies at Delhi and Chandigarh dated 2^nd December, 2010 & 23^rd December, 2010. Hence, appointed date for the implementation of the scheme was 23^rd December, 2010 with effect from 1^st April, 2008, being the effective date. The scheme of arrangement was duly implemented in the financial year 2010-11.

NOTES FORMING PART OF THE FINANCIAL STATEMENT FOR THE YEAR ENDED MARCH 31^st, 2016

- As per the scheme, food division of Alchemist limited had been demerged from the Company and transferred to and vested in Alchemist Foods Limited. All the properties, rights and power, assets, both movable and immoveable, liabilities including contingent liabilities and reserves, all income and expenses of the Food Division have without further act or deed been transferred to and vested with Alchemist Foods Limited at their book values, as a going concern with effect from the appointed date i.e. 1^st April, 2008. In consideration, thereof, Alchemist Foods Limited had issued 1,00,00,000 Equity Shares of Rs, 10/- each at a premium of Rs, 90/- per shares to Alchemist Limited and an amount of Rs, 27.44 Crores was treated as unsecured loan from Alchemist Limited to Alchemist Foods Limited.

- As per the Scheme of arrangement, Authorized share capital of Alchemist Limited i.e. Rs, 121.25 Crores as on effective date i.e. 1^st April, 2008 had been partly clubbed with Authorized Share Capital of the Transferee Company i.e. Alchemist Foods Limited. Accordingly, after implementation of scheme of arrangement, authorized share capital of Alchemist Limited had been reduced to Rs, 80.00 Crores consisting of Rs, 3.00 Crore equity shares of Rs, 10/

- each aggregating to Rs, 30.00 Crores and Rs, 50.00 Lac redeemable preference shares of Rs, 100/- each aggregating to Rs, 50.00 Crores.

3. Alchemist Limited has four subsidiaries namely Alchemist Foods Limited, Alchemist Infrastructures Private Limited, Alchemist Hospitality Group Limited and Alchemist Enterprises Pte Limited. The company had initiated steps to take over a company in Hong Kong as a subsidiary to further its international operations. However this process has not been completed pending approvals for remittances to be made towards capital.

4. In accordance with General Circular No. 2/2011 dated 8^th February, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Statement of Profit and Loss and other documents of subsidiary companies are not being attached with the Financial Statement of the Company.

5. Related Party Disclosures:

In accordance with the Accounting Standard (AS-18) on related party disclosure where controls exists and where transaction have taken place and description of the relationship as identified and certified by management are as follows:

Key Managerial Personnel

- Maj. Gen. (Retd.) Anil Oberoi o Mr. Pavan Kumar Verma

Subsidiary:

- Alchemist Foods Limited o Alchemist Infrastructures Private Limited o Alchemist Hospitality Group Limited o Alchemist Enterprise Pte Limited, Singapore

Associates:

- Alchemist Hospitals Limited

- Alchemist Airways Private Limited

- Alchemist Realty Limited

- Black Cat Protection Services Private Limited

- KDS Corporation Private Limited

- A 1 News Network Private Limited

- Alchemist Media Limited

- Dooteriah & Kalej Valley Tea Estate Private Limited

- Alchemist Medisphere Limited

- Technology Parks Limited

- Alchemist Lifescienses Limited

- Alchemist Aviation Private Limited

- Alchemist F&B Limited

- Alchemist Touchnology Limited

- Eco Breaking Technologies India Private Limited

- Jass Developers Private Limited

- Kandaghat Spa & Health Resorts Private Limited

- Alchemist Hotel & Resorts Limited

- Alchemist Universe of Education Limited

- Optimum Constructions & Developers Private Limited

- Alchemist Healthcare Limited

- Century 21 Properties India Pvt. Ltd.

Joint Venture:

- Alchemist Township India Limited

6. As per Accounting Standard - 28 “Impairment of Assets”, the company has assessed the conditions of all the assets used in its operation and is of the opinion that there is no impairment of assets, hence no provision was made.

7. Finished Goods Stock of Steel Division for year 2016 has been carried over including excise duty.

8. Common Expenses relating to Head Office and other administrative office have been allocated to various divisions on the following basis.

i) Financial Cost - Fixed & Current Assets Employed

ii) Other Expenses - Sales/Reasonable Estimations

9. During the year 3,840 (Previous year 9,300) preference shares were redeemed and as per provisions of the Companies Act, 1956 a sum of Rs, 3,84,000/- (Previous Year Rs, 9,30,000/-) has been transferred to Capital Redemption Reserve out of Statement of Profit & Loss. Further a sum of Rs, 47,50,426./- (Previous Year Rs, 87,53,875/-) has been transferred from Statement of Profit & Loss A/c to Preference Shares redemption reserve on account of premium amount of preference shares redeemed.

10. Disclosure of Micro and Small Enterprises (Trade Payables)

The company is in the process of compiling information from the suppliers regarding their status as Micro/ Small Scale Enterprises, so as to disclose the information as required by MSMED Act and Schedule VI of the Companies Act relating to Micro, Small and Medium Enterprises. In absence of confirmed information about the suppliers, it is practically not feasible to state the amount payable to them as on 31^st March, 2016.

11. The balances of majority of the Trade Receivables, Trade Payables and Loan & Advances made and received, are subject to confirmation and as such there balances are reflected in the Balance Sheet as appearing in the books, pending reconciliation, the net effect is unascertainable.

12. Assets Taken/ Given on Operating Lease:

Some of the Office premises have been taken/given on operating leases for a period of less than 10 years and are generally renewable by mutual consent on mutually agreeable terms. The agreements have an escalation clause. There are no sub leases and the leases are generally cancellable in nature.

13. Segment Reporting

a) The Business Segments comprise the following:

- Agri Business

- Pharma, Chemical & Minerals

b) Business segments have been identified based on the nature and class of products and services, their customers and assessment of the differential risks and returns and financial reporting system within the Company.

c) The company operates throughout in India, hence, no distinction on the basis of geographical segment have been made.

d) Segment accounting policies

In addition to the significant accounting policies, applicable to the business as set out in note 1 ‘Notes to the Financial Statements, the accounting policies in relation to segment accounting are as under:

(i) Segment assets and liabilities:

Segment assets include all operating assets used by a segment and consist principally cash, debtors, inventories and fixed assets, net of allowances and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities pertaining to two or more segment is allocated to the segment on reasonable basis.

(ii) Segment revenue and expenses :

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment

(iii) Inter Segment Sales:

Inter-segment sales are accounted for at cost and are eliminated in consolidation.

e) Primary Segment information (Business Segments) for the year ended 31^st March, 2016.

Defined Benefit Plans:

(a) Gratuity

(b) Compensated absences

Gratuity is an unfunded scheme, the present value of obligation is determined based on actuarial valuation, the disclosure of which is given as under:

Eligible Compensated absences of employees are adjustable against leave which the employee may avail in the future.

14. The Commissioner, Central Excise, Chandigarh, has proposed the classification of Poultry Keeping Machinery under Chapter 73 of the Central Excise Tariff Act, 1985 and has demanded the duty of Rs, 173.55 Lacs plus interest and penalty by invoking the extended period of limitation for 5 years. However, the company has cleared the goods as Poultry Keeping Machinery classifying the goods at -Nil- rate of duty under Chapter 84 of the CET Act, 1985. The company has been clearing the goods at -Nil- duty for more than last 5 years and the goods have been classified under Chapter 84 after duly intimating the department from time to time. Under Central Excise Law, the demand can be made for a period of one year under normal circumstances. However, in case of wilful suppression of facts, the duty can be demanded by invoking the extended period of limitation for last 5 years. In the aforesaid show cause notice, the department has raised the demand by invoking extended period of 5 years whereas since the activity has been undertaken after duly intimating the department therefore the demand is not sustainable for 5 years and at worst the demand can sustain for one year only.

The company has already paid the duty of Rs, 63.13 Lacs against the above demand as ‘Duty Paid Under Protest. Also the additional amount paid subsequent to the demand and till 31^st March 2013 is deposited under protest. Therefore the total duty of Rs, 92.29 Lac already paid is shown as (Amount recoverable in cash or in kind) in the Balance Sheet under the head Short Term Loan and Advances. The balance amount of Rs, 110.42 Lacs is pending payable against the demand and is shown as contingent Liability.

15. Financial reporting of interest in Joint Venture - Accounting Standard 27

Advance received include Rs, 12,29,49,002/- as advance received against joint development agreement entered into by the Company on 13^th June, 2013 and addendum dated 12^th July, 2013 with Alchemist Township India Limited for joint development of 7.2 acres of land of the Company situated at Village Dappar and Samlehri. The Project would be a residential development carried out under the name “Riviera Heights” with a built up area of at least 6,30,000 square feet. The Company is entitled to an overall advance of Rs, 50 Crores against the 35% share of the developed area along with proportionate rights in the land of the said project, which the developer is required to make available with the Company by 31^st March, 2016. The advance would be in the nature of a current account and the developer can demand withdrawal of the advance, subject to approval of the Company.

16. Some portions of the fixed assets records were misplaced during the year 2014-15 which have resulted in some estimates in order to tally the same with the books and records. The overall effect on depreciation for the year 201516 is not likely to be material.

17. The company extends credit from time to time as per market practices. In respect of export receivables amounting to Rs, 47363.02 lacs, credit has been extended for export sales and regular follow up is being done to recover the amounts from all the parties involved. The management is confident of recovering all these dues and hence no provision is considered necessary against these receivables as of now.

18. The economic downturn has impacted the international trade operations of the company. Taking cue the company has initiated many cost cutting measures including downsizing and vacation of office premises. During the year the company has vacated some office premises. Since the company had made some leasehold improvements to the same, the company had to take a write off of these leasehold improvements and accordingly has incurred a loss of Rs, 278.49 lacs reflected under Exceptional Items.

19. Companies wholly owned foreign subsidiary “Alchemist Enterprise (S) PTE Ltd.” is in the process of winding up. In the process the WOS has stopped operations and closed its bank accounts. A trade receivable of US$ 4,00,000/- standing in its books against which the payment of Rs, 265.33 lacs has been received by Alchemist Limited. Such amount received has been reflected as “Closure proceeds of WOS” under Other Current Liabilities until the process of winding up of the company is completed.

20. Cash in hand includes cash amounting to Rs, 180.54 lac which was seized by the Income Tax Authorities during the search and seizure operation u/s 132 of the Income Tax Act, 1961 during the month of June, 2014.

21. An unclaimed dividend pertaining to dividend declared for the year 2007-08 amounting to Rs, 10,73,327/- was transferred to Investor Education and Protection Fund during the year 2015-16.

22. Previous year’s figures have been reworked, regrouped, rearranged and reclassified wherever deemed necessary, to make them comparable.