a) During the earlier year, in accordance with the Approved Resolution Plan, the Company on 10th September, 2020, further allotted on preferential basis:- 115,32,00,000 equity shares of the face value of ' 1/- (Rupee One only) each, fully paid up, to Reliance Industries Limited, pursuant to conversion of debt; and 160,14,00,000 equity shares of the face value of ' 1/- (Rupee One only) each, fully paid up, to JM Financial Asset Reconstruction Company Limited (acting in its capacity as a Trustee of ‘JMFARC- March 2018 - Trust'- (JMFARC)), pursuant to conversion of debt. Accordingly the same has been issued for a consideration other than cash.

b) During the earlier year, In accordance with the Approved Resolution Plan, 10,827 equity shares belonging to the promoters of the Company stand cancelled and extinguished.

Reliance Industries Limited and JM Financial Asset Reconstruction Company Limited (acting in its capacity as Trustee

of JMFARC-March 2018-Trust) are also the only promoters of the Company.

(iii) Rights, preferences and restrictions attached to equity shares

i) The Company has one class of equity shares having a par value of 1 per share. Each holder of equity share is entitled to one vote per share.

ii) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

iii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.

iv) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to vote in proportion to his share of the paid-up capital of the Company.

v) In the event of liquidation, the equity shareholders are eligible to receive remaining assets of the Company, after distribution of all preferential amounts, in proportion to their shareholding.

(i) Optionally Convertible Preference Shares :

As per the Approved Resolution Plan, the Company had issued and allotted 250,00,00,000 9% Optionally Convertible Preference Shares (OCPS) of ' 1/- each to Reliance Industries Limited(RIL). (i) These OCPS are redeemable at the end of 10 years from the date of allotment i.e. 28 February 2020. (ii) dividend @9% per annum on outstanding amount is payable on cumulative basis.

(1) Working capital loans are secured by; (i) first ranking pari-passu charge on the current assets of the Company, both present and future (ii) second ranking pari-passu charge (after term loan) over the movable fixed assets of the Company, both present and future. (iii) loan is repayable on demand and carrying interest 7% to 9% per annum.

(2) The Company has been sanctioned working capital limits in excess of Rs. five crores in aggregate from banks during the year on the basis of security of current assets of the Company. The quarterly returns/statements filed by the Company with such banks are in agreement with the books of account of the Company.

As at 31 March 2023, the Company had available ' 56.84 crores (Previous Year: ' 107.87 crores) of undrawn committed borrowing facilities.

Performance Obligation

The performance obligation is satisfied upon delivery of the goods and payment is generally due within 7 to 90 days from delivery. There are no material unsatisfied performance obligation outstanding at the year end.

The performance obligations of the Company are part of contracts that have an original expected duration of less than one year and accordingly, the Company has applied the practical expedient and opted not to disclose the information about it's remaining performance obligations in accordance with IND AS 115.

Trade receivables are non interest bearing and are generally on terms of 7 to 90 days.

Contract assets includes amounts related to contractual right to consideration for completed performance objectives not yet invoiced.

Contract liabilities include payments received in advance of performance under the contract, and are realised with the associated revenue recognised under the contract.

32 Going Concern

In the earlier year, the Company has completed all the steps as laid down in the resolution plan approved by the National Company Law tribunal vide its order dated 8 March 2019 and the resolution applicants had obtained joint control over the Company and the Board of Directors had been re-constituted on 14 September 2020, being the closing date as determined by the Company in terms of the resolution plan.

During the FY 2022-23, owing to extreme volatility in raw material prices, subdued demand from overseas markets with hike in energy prices, the Company incurred a loss of ' 874.89 crore. It has accumulated losses of ' 21,285.88 crore and its current liabilities exceed its current assets by ' 918.44 crore as at 31 March 2023. The market condition is improving and considering the cash flow projection of the Company, the financial statements have been prepared on a going concern basis.

33 As per Clause 1.2 (xi) of Approved Resolution Plan, the outstanding debt amounting to ' 17,384.02 crore assigned to Resolution Applicants shall not carry interest for the first 8 years from the Closing Date (as defined in the Approved Resolution Plan), hence such debt has been measured at cost. After such period of 8 years, the terms of assigned debt shall be mutually agreed among the Resolution Applicants and the Company. The Approved Resolution Plan has an overriding effect on the requirements of Ind AS, as per legal view obtained by the Company in this regard. Hence, had the Company applied the Ind AS, it would have recognised the assigned debt at its fair value and accordingly recognized the imputed interest cost over the period of loan in the statement of profit and loss.

34 As on June 2017, the Company had an amount of ' 11,623.94 crore receivable from trading debtors on account of sale of fabric (“Outstanding Trading Dues”). As at 31 March 2019, the Company had created full provision against said receivables by charging it to the statement of profit and loss in earlier years. As per the Approved Resolution Plan, if any of the trading debtors make payment towards the Outstanding Trading Dues or any person is required to contribute to the assets of the Company under any legal process against the Outstanding Trading Dues and has contributed the same, such amounts (net of any income tax payable by the Company on account of such receipt of the Outstanding Trading Dues) shall be deposited in a designated escrow account (“Escrow Account”) to be opened in the name of the Company. Provided however, nothing contained in the resolution plan shall oblige the Resolution Applicants or the Company to take steps for recovery of the Outstanding Trading Dues.

Accordingly, the Company has an obligation to deposit into the escrow account any collections received out of the “Outstanding Trading Dues” or otherwise, as stated above, for the benefit of the Financial Creditors and as a result therefore, the risk and reward associated with the Outstanding Trading Dues now belong to the Financial Creditors. Accordingly the Company had derecognised the said outstanding trade receivables and related provisions in the books. The Company has not received any amounts towards Outstanding Trading Dues in the current year.

35 The Code on Social Security, 2020 (‘Code') relating to employee benefits during employment and post employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective. Based on preliminary assessment, the Company believes the impact of the change will not be significant.

Note

1 The Company has also issued a letter of comfort to Alok Infrastructure Limited, wholly owned subsidiary Company in order to meet its financial obligations. As on 31 March 2023, management has assessed that the possibility of outflow of resources embodying economic benefits with respect to the letter of comfort issued is remote.

2 Claims / Debts against the Company up to the closing date which are addressed under the NCLT approved resolution plan are not included in contingent liabilities though many of such claims / debts may be pending for disposal at various judicial forums. As per clause 3.3.4 of the aforesaid resolution plan, these liabilities stands extinguished.

Accordingly, the management has assessed that the possibility of outflow of resources embodying economic benefits with respect to such claims / debts is remote.

3 All direct and indirect tax liabilities relating to assessments of earlier year up to the closing date stand extinguished as per the NCLT approved resolution plan. Further, the implementation of the resolution plan does not have any effect over claims or receivables owed to the Company. Accordingly, the Company has assessed that any receivables due to the Company, evaluated based on merits of underlying litigations, from various governmental agencies continues to subsist.

4 The Company had entered into a 15-year Gas Sale Agreement (GSA) dated 27 May 2013 with GAIL India Limited (‘GAIL') for the supply of re-liquified natural gas (RLNG) which included a Take or Pay (ToP) obligation on the Company. All of GAIL's claims against the Company were dealt with as per the provisions of the resolution plan which was submitted during the Corporate Insolvency Resolution Process of the Company and which was duly approved by the Hon'ble National Company Law Tribunal, Bench at Ahmedabad (NCLT) vide its dated 8 March 2019. For and in relation to the periods thereafter (post the closing date i.e. 14 September 2020), GAIL raised demands (which, as on 31 March 2023, aggregate to ' 717.95 Crores). These demands were made purportedly under the ToP regime of the said GSA, despite however the Hon'ble NCLT already having directed a re-negotiation of the GSA. Aggrieved, GAIL challenged the said order of the Hon'ble NCLT by preferring an appeal before the Hon'ble National Company Law Appellate Tribunal (NCLAT). GAIL's appeal, however, came to be dismissed by the Hon'ble NCLAT's order dated 4 October 2021. This order of Hon'ble NCLAT was then challenged by GAIL by preferring an appeal before the Hon'ble Supreme Court. Even this appeal of GAIL was dismissed by the Hon'ble Supreme Court by its order dated 21 March 2022.

In the circumstances, the Hon'ble NCLT's order, which was effective throughout and which had directed a renegotiation of the GSA under which GAIL made its claims, has thus now attained finality. The Company has since also sought legal opinion in the matter and based on it and the aforesaid circumstances, the Company is of the view that in terms of the order of the Hon'ble NCLT, there is no liability, either contingent or otherwise, under the GSA as claimed by GAIL or otherwise.

The Company has already in terms of the said order of the Hon'ble NCLT initiated the process for renegotiation of the GSA with GAIL and the same is pending finalization.

38 The Company has determined that there is no reasonable certainty that the deferred tax assets will be utilised in near future. On the basis of such assessment, the Company has not recognised any net deferred tax assets as at 31 March 2023.

C. Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm's length transactions. Outstanding balances at the year-end are unsecured, interest free and will be settled in cash. There have been no guarantees received or provided for any related party receivables or payables.

No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member.

41 Disclosures Pursuant to - “Employee benefits”:i) defined contribution plans:

The Company's contribution to Provident Fund for the year 2022-23 aggregating to ' 9.30 crore (Previous Year: ' 8.04 crore), ' 0.88 crore (Previous Year: ' 0.87 crore) for ESIC has been recognised in the statement of profit and loss under the head employee benefits expense. (Refer Note 28).

ii) defined benefit plans: a) Gratuity plan:

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The level of benefits provided depends on the member's length of service and salary at retirement age.

The Company makes annual contribution to the Employee's Company Gratuity Assurance Scheme, a funded defined benefit plan for qualifying employees. The Fund invests in the scheme of insurance with the Life Insurance Corporation of India, IndiaFirst Life Insurance Company Limited, SBI Life Insurance Company Limited and Canara HSBC Life Insurance Company Limited. The scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to fifteen days salary payable for each completed year of service or part thereof in excess of six months.

The plans typically expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk. Interest risk : The plan exposes the Company to the risk off all in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the above benefit and will thus result in an increase in the value of the liability.

Longevity Risk : The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

Salary risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan's liability.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out at 31 March, 2023 by KP Actuaries and Consultants LLP. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the Project Unit Credit Method as per Ind AS 19.

42 Segment Information:

The Chief Operating Decision Maker (CODM) monitors the operating results at the Company level for the purpose of making decisions about resource allocation and performance assessment. Accordingly, the Company operates in a single primary segment namely “Textiles”, which constitutes a reportable segment as per Ind AS 108.

43 Capital Management and Financial Management Framework:

The Company being in a working capital intensive industry, its objective is to maintain a strong credit rating, healthy ratios and establish a capital structure that would maximize the return to stakeholders through optimum mix of debt and equity.

The Company's capital requirement is mainly to fund its capex, working capital, repayment of principal and interest on its borrowings. The principal source of funding of the Company has been, and is expected to continue to be, cash generated from its operations supplemented by funding from bank borrowings and the capital markets. The Company is not subject to any externally imposed capital requirements.

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 capital plus net debt. Since net worth of the Company is negative, debt equity ratio is not calculated.

The key risks associated with day to day operations of the Company and working capital management are given below:

A. Credit Risk:

Credit risk is the risk that counter party will not meet its obligation under a financial instrument or customer contract leading to a financial loss. The Company is exposed to credit risk mainly from trade receivables and other financial assets.

i) Trade Receivables:

Trade receivables are typically unsecured and are derived from revenue earned from customers. Credit risk has been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. On account of adoption of Ind AS 109, the Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix and forward-looking information and an assessment of the credit risk over the expected life of the financial asset to compute the expected credit loss allowance for trade receivables. Concentrations of credit risk with respect to trade receivables are limited.

ii) Other Financial Assets & loans

The Company has limited credit risk arising from cash and cash equivalents as the deposits are maintained with banks and financial institutions with high credit rating. Further, other financial assets mainly comprises of Export incentives which are recoverable from Government. Hence, these are low risk items and the Company evaluates the recoverability of these financial assets at each reporting date and wherever required, a provision is created against the same.

The Company had in earlier years given loans to its subsidiaries/a Company in which erstwhile directors were interested of ' 1,465.99 crore, which are fully provided for in the books. The net exposure of ' 182.12 crore is with respect of one wholly owned subsidiary whereby the Company has impaired to the extent of the fair valuation of the subsidiary's investment properties / inventories.

B. 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 prices. Market risk comprises of three types of risks - interest rate risk, currency risk and other price risk in a fluctuating market environment. Financial instrument affected by market risks includes loans and borrowings, deposits, derivatives and other financial assets.

i) Currency Risk

The Company's functional currency is Indian Rupees (INR). The Company undertakes transactions denominated in foreign currencies; consequently, exposure to exchange rate fluctuations arise. Volatility in exchange rates affects the Company's revenue from export markets and the costs of imports. The Company has exports and to that extent has a natural hedge as a mitigation measure to cover foreign exchange risk on account of imports/ expenses in foreign currency. The Company hedges its foreign currency risk by entering into forward contracts.

Foreign Currency Sensitivity

5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an

ii) Interest rate risk

a. 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. The Company is exposed to interest rate risk because funds are borrowed at both fixed and floating interest rates. Interest rate risk is measured by using the cash flow sensitivity for changes in variable interest rate. The borrowings of the Company are principally denominated in rupees with a mix of fixed and floating rates of interest. The Company has exposure to interest rate risk, arising principally on changes in base lending rate. The Company uses a mix of interest rate sensitive financial instruments to manage the liquidity and fund requirements for its day to day operations. The risk is managed by the Company by maintaining a mix between fixed and floating rate borrowings.

iii) Commodity Price Risk

Commodity price risk arises due to fluctuation in prices of raw materials like PTA, MEG, cotton and yarn. The Company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs. The Company's commodity risk is managed centrally through well-established trading operations and control processes.

C. Financial risk management objectives

The Company has a Risk Management Committee established by its Board of Directors for overseeing the Risk Management Framework and developing and monitoring the Company's risk management policies. The risk management policies are established to ensure timely identification and evaluation of risks, setting acceptable risk thresholds, identifying and mapping controls against these risks, monitor the risks and their limits, improve risk awareness and transparency. Risk management policies and systems are reviewed regularly to reflect changes in the market conditions and the Company's activities to provide reliable information to the Management and the Board to evaluate the adequacy of the risk management framework in relation to the risk faced by the Company.

D. Liquidity Risk:

Liquidity risk refers to the risk of financial distress or extraordinary high financing costs arising due to shortage of liquid funds in a situation where business conditions unexpectedly deteriorate and requiring financing. The Company requires funds both for short term operational needs as well as for long term capital expenditure for capex. The Company generates sufficient cash flow from operations, which together with the available cash and cash equivalents provide liquidity in the short-term and long-term. The Company has established an appropriate liquidity risk management framework for the management of the Company's short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk through cash generated from operations, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. As at 31 March 2023, the Company has undrawn committed borrowing facilities amounting to ' 56.84 crore and the Company expects to enjoy all the working capital limits sanctioned to it in FY 23-24.

During the current year, due to the adverse market situation, the Company's performance has been impacted, which has led to breach of some of the financial covenants of the term loans. The Company is regular in payment of interest and repayment of loan instalments and expects to meet all future obligations as and when due and hence the said covenant default is not expected to have any adverse impact on the financial statements.

The following tables detail the Company's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The amount disclosed in the tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The contractual maturity is based on the earliest date on which the Company may be required to pay.

Fair value hierarchy

The Company uses the following hierarchy for determining and/or disclosing the fair value of financial instrument by valuation technique:

(i) Level 1 — quoted (unadjusted) market prices in active markets for identical assets or liabilities;

(ii) Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;

(iii) Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

There has been no transfers between level 1 & level 2 during the period.

45 Lease Disclosures Company as a lessee

The Company has lease contracts for land used in its operations, which has a lease terms of 95 years. As per the terms of lease, the Company was required to make one-time advance lease payment for the leased land. Hence, following the terms of the leased agreement, the Company has made the one-time lease payment and consequently, there are no lease liabilities recorded in the Balance Sheet as at 31 March, 2023.

The Company has also entered into new lease contracts (from 1 October 2022), for factory buildings with tenure of 10 years with a lock in period of 3 years.

The Company had total cash outflows for leases of INR ' 2.53 crore in 31 March, 2023 (Previous Year: ' Nil). incremental borrowing rate for lease liabilities is 9%.

Extension and termination option

The lease of building contain termination options exercisable by both the lessor and the lessee after the end of the non-cancellable contract period. Where practicable, the Company seeks to include termination options in new leases to

provide economic viability. The Company assesses at lease commencement whether it is reasonably certain to exercise the termination options. The Company reassesses whether it is reasonably certain to exercise the options if there is a significant event or significant change in circumstances within its control.

Company as a lessor

The Company has entered into leases on its investment property portfolio consisting of certain Residential flats and commercial buildings (see Note 3). These leases have terms of between 5 and 20 years. All leases include a clause to enable upward revision of the rental charge on an annual basis according to prevailing market conditions. Rental income recognised by the Company during the year is ' 0.46 crore (2021-22: ' 0.25 crore). There are no non-cancellable leases.

46 The Company had granted interest free loan in earlier years (prior to corporate insolvency resolution process) to a company which is outstanding as at the year-end amounting to ' 233.32 crores (against which an impairment allowance of ' 233.32 crores is made). Further, the Company had granted interest free loan in earlier years (prior to the corporate insolvency resolution process) to its wholly owned subsidiaries (‘WOS') which are outstanding as at the year-end amounting to ' 2,605.66 crores (against which an impairment allowance of ' 2,423.54 crores is made). Based on legal opinion obtained by the Company, the provisions of section 186 of the Companies Act, 2013 are not applicable to all such interest free loans granted under the erstwhile Companies Act, 1956 and by virtue of the resolution plan approved by the NCLT, any claim from the authorities with respect to the breach / contravention / non-compliance of any Applicable law is abated, settled and extinguished as at the closing date (i.e. 14 September 2020).

47 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. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural development projects.

A CSR committee has been formed by the Company as per the Act. The Company has incurred losses in current and in previous years, Accordingly, as the average net profit for immediately preceding three financial years is NIL there are no amounts required to be spend on corporate social responsibility under section 135 of the Companies Act, 2013. Consequently, there are no unspent amount on ongoing projects / other than ongoing projects.

48 In the earlier year, on 22 March 2021, the NCLT has passed the order for withdrawal of the corporate insolvency resolution process for Alok Infrastructure Limited (“AIL”), wholly owned subsidiary of the Company. Post this, the subsidiary had also performed a valuation of its investment properties / inventories with the help of external valuation specialists and accordingly considered impairment in its books in earlier years. AIL do not have significant business operations and has made a loss of ' 12.84 crore for the year ended 31 March 2023 and has accumulated losses of ' 1505.23 crore as on 31 March 2023. During the current year, the said subsidiary has also reassessed the valuation of its investment properties / inventories with the help of external valuation specialist and there are no significant change in the valuation and accordingly the impairment provision made in earlier years is adequate (refer note 6).

49. The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) to or in any other person or entity, including foreign entities (“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.

Further, the Company has not received any funds from any person or entity, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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.

50 Other Disclosure

a. There are no proceedings initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

b. The Company has not entered into any transactions with struck off companies during the year.

c. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

d. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

e. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

f. The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

g. The Company has complied with the relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and the Companies Act for the above transactions and the transactions are not violative of the Prevention of MoneyLaundering Act, 2002 (15 of 2003).

52 Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.