Aurangabad Distillery Limited

The Board of Directors has pleasure in presenting herewith their 23^rd Annual Report together with the Audited Financial Statements
of your Company for the year ended 31^st March, 2023.

FINANCIAL SUMMARY

The Company’s financial performance for the year under review along with previous year’s figures is given hereunder:

(Rs. in Lakhs)

REVIEW OF OPERATIONS AND FUTURE OUTLOOK

The Company generated revenue of Rs.12,229.21 Lakhs
during the current year as against revenue of Rs. 10,255.91
Lakhs generated in the preceding year. The operations of the
Company have resulted into post tax profit of Rs.1,676.17 Lakhs
against post tax profit of Rs.898.22 Lakhs in the preceding year.

The product portfolio of Company includes production of
various types of Alcohol viz Rectified Spirit, Neutral Alcohol,
Extra Neutral Alcohol and Denatured Spirit.

The National Policy on Biofuels - 2018, provides an indicative
target of 20% ethanol blending under the Ethanol Blended
Petrol (EBP) Programme by 2030. Currently petrol with 10%
ethanol blend (E10) is being retailed by various Oil Marketing
Companies (OMCs) in India, wherever it is available. The usage
of rectified spirit as a raw material in ethanol production creates
new opportunities for the distillery industry.

DIVIDEND

Owing to the growing business needs and the necessity to

plough back the profits in the business, your directors do not
recommend any dividend for the year.

TRANSFER TO RESERVES

The Board of Directors do not recommend to carry any amount
to reserves. The Board of Directors proposes an amount of Rs.
1676.17 Lakhs to be retained in the statement of profit and loss
account.

WEBLINK OF ANNUAL RETURN

The Company has its website; the link for Annual Return is as
follows https://aurangabaddistillery.com/report.php

NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met Eight (8) times during the year
under review on 1^st April 2022, 27^th May 2022, 26^th June 2022,
6^th September 2022, 1^st November 2022, 14^th November 2022,
23^rd January 2023 and 1^st March 2023 respectively. Notice of
meetings with agenda along with necessary details was sent to
the Directors in time.

COMMITTEES OF THE BOARD

i) Audit Committee

Composition of Audit Committee of the Company as
follows:

ii) Nomination and Remuneration Committee

Composition of Nomination and Remuneration Committee
as follows:

iii) Stakeholders Relationship Committee

Composition of Stakeholders Relationship Committee as
follows:

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with Section 152 of the Companies Act, 2013,
Mr. Dharampal Kimatram Kalani and Mr. Tanaji Haribhau Yadav
are retiring by rotation at the ensuing Annual General Meeting
and being eligible have offered themselves for re-appointment.

Mr. Avinash Salunkhe has re-appointed by the Board of
Directors as an ‘Independent Director’ of the Company for a
period of 1 (One) Year with effect from 13^th November 2022
subject to approval of members of the Company at the ensuing

Annual General Meeting (AGM).

Further, during the year under review Ms. Ankita Gandhi has
resigned as Company Secretary of the Company w.e.f. 31^st
October 2022 and Ms. Komal Shendge was appointed as
Company Secretary of the Company w.e.f. 1^st November 2022.

DECLARATION ON FROM INDEPENDENT DIRECTORS

All Independent Directors have given Declaration that;

a. They meet the criteria for independence as laid down
under Section 149(6) of the Companies Act, 2013, and
Regulation 25(8) read with 16(1)(b) of the Listing Obligation
and Disclosure Requirements, 2015.

b. The Independent Directors have complied with the Code
for Independent Directors prescribed in Schedule IV to the
Act.

In the opinion of the Board, the Independent Directors fulfil
the conditions specified in the Listing Regulations and are
Independent of the Management. Further there has been
no change in the circumstances affecting their status as
Independent Directors of the Company.

NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy is designed to
attract, motivate, improve productivity and retain manpower, by
creating a congenial work environment, encouraging initiatives,
personal growth and team work, and inculcating a sense
of belonging and involvement, besides offering appropriate
remuneration packages and superannuation benefits. The
policy reflects the Company’s objectives for good corporate
governance as well as sustained long term value creation for
shareholders.

Overall, the Nomination and Remuneration Policy of the
Company demonstrates the company’s commitment to fostering
a conducive work environment, recognizing and rewarding
employee contributions, and ensuring the long-term success
and growth of the organization while upholding principles of
good corporate governance.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013,
the Board of Directors of your Company, to the best of their
knowledge and ability, confirm that:

(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with
proper explanation relating to material departures;

(b) The Directors have selected such accounting policies
and applied them consistently and made judgments and

estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company
at the end of the financial year and of the profit of the
Company for the period;

(c) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance
with the provisions of the Act for safeguarding the assets
of the Company and for preventing and detecting fraud and
other irregularities;

(d) The Directors have prepared the annual accounts on a
going concern basis;

(e) The Directors have laid down proper internal financial
controls and system which are adequate and are operating
effectively; and

(f) The Directors have devised proper systems to ensure
compliance with the provisions of all applicable laws and
that such systems are adequate and operating effectively.

AUDITORS &THEIR REPORTS

A) STATUTORY AUDITORS

In the 22^nd Annual General Meeting of the Company held
on 30^th September 2022, members of the Company have
appointed M/s. HMA & Associates, Chartered Accountants,
Pune (Firm Registration No.: 100537W) as a Statutory
Auditors of the Company to hold office from the conclusion
of the 22^nd Annual General Meeting for a period of 5 (five)
consecutive financial years i.e., from the conclusion of 22^nd
Annual General Meeting which was held for the financial
year 2022 until the conclusion of the 27^th Annual General
Meeting to be held for the financial year 2027-28.

In response to Auditors’ Report, Para wise explanation by
the management is given below:

i. Point No. 2 (b) of CARO Report ‘Inventory’ - Quarterly
statements are filed with such Banks which are not in
agreement with the books of account, which is as per
the explanations given by the company in Note No. 39
of the Financial Statements of the company.

The details of the differences are as under:

(Rs. in Lakhs)

Management Reply:- The difference is due to change in
method of valuation of inventories as per AS-2 from FIFO
method to Weighted Average method during the year. The
change in the accounting policy was implemented due
to the rate variations in purchase of primary raw material
(Molasses) arising due to its seasonal nature of production.
Such change in accounting policy has decreased the
valuation on inventories by Rs. 188.37 lakhs as on 31^st
March 2023.

B) SECRETARIAL AUDITORS

The Board of Directors had appointed M/s. Prajot Tungare
& Associates, Practicing Company Secretaries as the
Secretarial Auditors of your Company to issue a Secretarial
Audit Report pursuant to Section 204 of the Companies
Act, 2013 for the Financial Year 2022-23.

The Secretarial Auditors have given their report, which is
annexed hereto as “Annexure I”.

Further, as per recommendation of the Audit Committee, the
Board of Director has re-appointed M/s. Prajot Tungare &
Associates, Practicing Company Secretaries as Secretarial
Auditors of your Company in their meeting held on 27^th May
2023 for the Financial Year 2023-24.

The Secretarial Auditors’ Comment/observation -

i. There was some delay in filing e forms with the Ministry
of Corporate Affairs;

Management Reply:- The delay was due to inadvertence.
The Company has taken sufficient precautions so as not
to repeat such instance in future. Further, the said delays
were unintentional and have not affected the interests of
the stakeholders, neither have benefited any persons.

C) COST AUDITORS

The Company is required to have the audit of its cost
records conducted by a Cost Accountant in Practice. In
this connection, the Audit Committee has recommended
to the Board of Directors and the Board of Directors had
approved the appointment of M/s. Dargad & Associates,
Cost Accountants, as Cost Auditors of the Company to
conduct the Cost Audit functions for the Financial Year
2022-23.

Further, as per recommendation of the Audit Committee,
the Board of Director has re-appointed M/s. Dargad
& Associates, Cost Accountants, as Cost Auditors of
the Company to conduct the Cost Audit functions for
the Financial Year 2023-24 subject to rectification of
remuneration of the cost auditor in ensuring Annual
General Meeting.

The Company has maintained cost records as stated in
the provisions of maintenance of Cost Records pursuant
to Section 148 of the Companies Act, 2013 read with
Companies (Cost Record & Audit) Amendment Rules 2014.

D) INTERNAL AUDITOR

The Board of Directors had appointed M/s. S. R. Bakare &
Co., Chartered Accountants as the Internal Auditor of the
Company pursuant to Section 138 and other applicable
provisions, if any of the Companies Act, 2013 for the
financial year 2022-23.

As per recommendation of the Audit Committee, the
Board of Director has re-appointed M/s. S. R. Bakare &
Co., Chartered Accountants as an Internal Auditor of the
Company for the Financial Year 2023-24.

COMPLIANCE OF THE SECREATARIAL STANDARDS
ISSUED BY ICSI

The Board confirms that, during the period under review,
the Company has complied with the applicable Secretarial
Standards to the extend applicable to the Company issued by
the Institute of Company Secretaries of India (ICSI) as amended
from time to time.

DETAILS IN RESPECT OF FRAUDS REPORTED BY
AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OF
THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH
ARE REPORTABLE TO THE CENTRAL GOVERNMENT

There were no frauds reported by Auditors under Sub-Section
(12) of Section 143 of the Companies Act, 2013 other than
those which are reportable to the Central Government.

SHARE CAPITAL

The paid-up share capital of the Company as on 31^st March
2023 was Rs. 8.20 Crores. During the year, the Company has
not issued any securities.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS

Particulars of loans given, investments made, guarantees given
and securities provided as on 31^st March 2023 are mentioned in
the table herein-below:

(Rs. in Lakhs)

PARTICULARS OF CONTRACTS OR ARRANGEMENTS
MADE WITH RELATED PARTIES

The transactions entered by the Company with related parties
were in ordinary course of business and at arm’s length basis.
The particulars of transactions entered with related parties are
annexed herewith as “Annexure II” to this report.

MATERIAL CHANGES AND COMMITMENT, IF ANY,
AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments affecting the financial
position of the Company occurred between the end of the
financial year to which these financial statements relate till the
date of this report. Except that, the Company has received
order from Office of Commissioner, State Excise, State of
Maharashtra, Mumbai on 16^th August 2023 for payment of duty.

The Order has been received by the Company on the grounds
that the Company has released 34,58,175 liters of pure alcohol
for the manufacturing of liquor. Therefore, the Company shall
deposit an amount of Rs.1,435.14 million within 15 days with
the Government. If the said amount is not paid within the
prescribed period, further legal action will be taken by the
Collector, Pune, as per the provisions of Land Revenue Act to
recover the said amount. Further, Form-I license no.6 Unit of
the Company has cancelled. The said Order has effective from
the 21^st August 2023.

However, the Company has filed application for the stay order
in the appropriate court/authority.

Management recognizes that the Company’s future operations
are unlikely to be significantly impacted by COVID-19 due
to widespread vaccination efforts and the Company’s prior

experience with the pandemic. Despite ongoing monitoring of
future economic conditions, the Company maintains a positive
outlook for the upcoming financial year.

CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND
OUTGO

The particulars prescribed under section 134(3)(m) of the
Companies Act, 2013 read with Rule 8 of the Companies
(Accounts) Rules, 2014, are set out in Annexure - III to this
Report.

DEVELOPMENT AND IMPLEMENTATION OF RISK
MANAGEMENT POLICY OF THE COMPANY

The Company has a robust risk management framework
that includes a well-defined risk governance structure and
established processes. It proactively identifies and assesses
all strategic, operational, and financial risks by analyzing the
most up-to-date risk information from both internal and external
sources. This valuable insight is then utilized to plan and
implement risk mitigation activities effectively.

INTERNAL FINANCIAL CONTROLS

The Company has implemented comprehensive procedures
to ensure robust internal financial controls. It consistently
adheres to industry best practices to safeguard its assets,
prevent and detect frauds and errors, maintain the accuracy
and completeness of accounting records, and ensure the timely
preparation of reliable and accurate financial information.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE
COMPANIES AND THEIR POSITION & FINANCIAL
PERFORMANCE

The Company does not have any Subsidiary, Joint venture or
Associate Company.

DEPOSITS

Your Company has not accepted any deposits within the
meaning of Section 73 of the Companies Act, 2013.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS
PASSED BY THE REGULATORS OR COURTS IMPACTING
THE GOING CONCERN STATUS AND COMPANY’S
OPERATIONS IN FUTURE PURSUANT TO RULE 8(5)(VII)
OF COMPANIES (ACCOUNTS) RULES, 2014

The Company has not received any significant or material
order passed by regulators or courts or tribunals impacting the
Company’s going concern status or the Company’s operations
in future except below:

The Company has received order from Office of Commissioner,
State Excise, State of Maharashtra, Mumbai on 16^th August
2023 for payment of duty.

The Order has been received by the Company on the grounds
that the Company has released 34,58,175 liters of pure alcohol
for the manufacturing of liquor. Therefore, the Company shall
deposit an amount of Rs.1435.14 million within 15 days with the
Government. If the said amount is not paid within the prescribed
period, further legal action will be taken by the Collector, Pune,
as per the provisions of Land Revenue Act to recover the said
amount. Further, Form-I license no.6 Unit of the Company has
cancelled. The said Order has effective from the 21^st August
2023.

However, the Company has filed application for the stay order
in the appropriate court/authority

MANAGEMENT’S DISCUSSION AND ANALYSIS REPORT

Management’s Discussion and Analysis Report for the
year under review, as stipulated under the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (“Listing Regulations”) is
presented in “Annexure-IV” to this report.

PERFORMANCE EVALUATION

The Company has developed a comprehensive policy for
evaluating the performance of the Board, Committees, and
individual Directors, including Independent Directors and
Executive Directors. This policy encompasses various criteria
for assessing the performance of Non-executive Directors and
Executive Directors. The evaluation process takes into account
factors such as Directors’ attendance at Board and Committee
Meetings, understanding of the Company’s business, effective
communication among Board members, active participation,
domain knowledge, adherence to the code of conduct, vision
and strategy, and benchmarks set by global peers. Importantly,
this evaluation process ensures compliance with all relevant
laws, regulations, and guidelines.

Pursuant to the provisions of the Companies Act, 2013, the
Board has carried out performance evaluation of its own
performance and that of its committees and individual Directors.

PARTICULARS OF EMPLOYEES

Disclosure as per Section 197(12) of the Companies Act, 2013
and Rule 5 of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 is annexed herewith as
“Annexure - V” to this report.

VIGIL MECHANISM

The Company has a vigil mechanism named as Whistle Blower
Policy of the Company, an avenue to raise concern and access
in good faith the Chairman of the Audit Committee which
provide for adequate safeguard against victimization of person.
The Policy on Whistle Blower Policy is available on the website
of the Company under the weblink www.aurangabaddistillery.
com.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF
WOMAN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013

As per requirements of the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013
(SHWWA), the Company has designed and implemented a
comprehensive policy and framework to promote a safe and
secure work environment, where every person at the work place
is treated with dignity and respect. Moreover, the Company’s
policy is inclusive and gender neutral. Further, the complaint
redressal mechanism detailed in the policy ensures complete
anonymity and confidentiality to the parties.

Internal Complaints Committee (ICC) have been constituted as
per the requirement with the highest governance norms. During
the year under review, there was no complaints received
pursuant to the aforesaid Act.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVE

Pursuant to the Section 135(9) of the Companies Act, 2013,
the CSR Committee is not required to be constituted if amount
to be spent by a Company in a year does not exceed Rs. 50
Lakhs. Currently, the CSR liability for the Company is less
than Rs.50 Lakhs. Hence all functions for fulfilling CSR liability
shall be carried out by the Board of Directors of the Company.
And during the year, the CSR Committee of the Company has
dissolved.

However, before dissolution of CSR Committee, the CSR
Committee met 1(One) time during the year i.e., on 6^th
September 2022.

Pursuant to Rule 8 of the Companies (CSR Policy) Rules, 2014
the detailed Report on CSR Activities for the financial year
2022-23 is enclosed as “Annexure- VI”.

INSOLVENCY AND BANKRUPTCY CODE UPDATE

No application has been made / No proceeding is pending
under the Insolvency and Bankruptcy Code, 2016 during the
year under review.

VALUATION FOR ONE TIME SETTLEMENT WITH BANK
AND FINANCIAL INSTITUTION

The Company has not made any valuation for one-time
settlement with Bank and financial Institution. Hence, there is
no reason for elaboration on the said aspect.

OTHER MATTERS

Your directors state that no reporting is required in respect of
the following items for the reasons mentioned therein:

1. There is no change in the nature of business.

2. Neither the Managing Director nor the Whole Time
Directors of the Company receive any remuneration or
commission from any of its subsidiaries.

3. There were no complaints relating to child labour, forced
labour or involuntary labour during the financial year 2022¬
23.

ACKNOWLEDGEMENTS

Your directors place on records their sincere thanks to bankers,
business associates, consultants, and various Government
Authorities for their continued support extended to your
Companies activities during the year under review. Your
directors also acknowledge gratefully the shareholders for their
support and confidence reposed on your Company.

For and on behalf of the Board of Directors of
Aurangabad Distillery Limited

Amardeepsingh Sethi
Chairman & Whole time Director

DIN: 00097644

Date: 4^th September 2023
Place: Chhatrapati Sambhajinagar