2.17. Provisions and Contingencies:
Provisions are recognized when the Company has a present obligation as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
Contingent liabilities are disclosed in respect of possible obligations that arise from past events, whose existence would be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company. Such liabilities are disclosed by way of notes to the financial statements. No disclosure is made if the possibility of an outflow on this account is remote.
2.18. Borrowing cost:
Borrowing costs are interest and other costs (including exchange differences relating to foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs) incurred in connection with the borrowing of funds. Borrowing costs directly attributable to acquisition or construction of an asset which necessarily take a substantial period of time to get ready for their intended use are capitalized as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.
Where there is an unrealized exchange loss which is treated as an adjustment to interest and subsequently there is a realised or unrealized gain in respect of the settlement or translation of the same borrowing, the gain to the extent of the loss previously recognised as an adjustment is recognised as an adjustment to interest.
2.19. Share based payments:
Equity- settled share-based payments to employees are measured at the fair value of the employee stock options at the grant date.
The fair value of option at the grant date is expensed over the vesting period with a corresponding increase in equity as "Share Option outstanding account”. In case of forfeiture of unvested option, portion of amount already expensed is
reversed. In a situation where the vested option forfeited or expires unexercised, the related balance standing to the credit of the "Share Option outstanding account” are transferred to the "General Reserve”. When the options are exercised, the Company issues new fully paid up equity shares of the Company. The proceeds received and the related balance standing to credit of the Share Option outstanding account, are credited to equity share capital (nominal value) and Securities Premium.
2.20. Segment Reporting:
Segments are identified based on the manner in which the Chief Operating Decision Maker ('CODM’) decides about resource allocation and reviews performance. Segment results that are reported to the CODM include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Segment capital expenditure is the total cost incurred during the period to acquire property and equipment and intangible assets other than goodwill.
2.21. Climate Related Matters:
The Company considers climate-related matters in estimates and assumptions, where appropriate. This assessment includes a wide range of possible impacts on the Company due to both physical and transition risks. Even though the Company believes its business model and products will still be viable after the transition to a low-carbon economy, climate-related matters increase the uncertainty in estimates and assumptions. Even though climate-related risks might not currently have a significant impact on measurement, the Company is closely monitoring relevant changes and developments, such as new climate-related legislation.
2.22. Earnings per share:
(i) Basic earnings per share
Basic earnings per share are calculated by dividing the net profit or loss before other comprehensive Income for the period attributable to equity shareholders of parent by the weighted average number of equity shares outstanding during the period.
(ii) Diluted earnings per share:
Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take into account:
• The after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and
• The weighted average number of additional equity shares that would have been outstanding assuming the conversion of all dilutive potential equity shares.
2.23. Changes in accounting policies and disclosures
The Ministry of Corporate Affairs has notified Companies (Indian Accounting Standards) Amendment Rules, 2023 dated 31 March 2023 to amend the following Ind AS which are effective from April 1, 2023. The Company applied for the first-time these amendments.
i. Ind AS 1 - Disclosure of material accounting policies: The
amendments related to shifting of disclosure of erstwhile "significant accounting policies’ to "material accounting policies’ in the notes to the financial statements and adding guidance on how entities apply the concept of materiality in making decisions.
The amendments have had an impact on the Company disclosures of accounting policies, but not on the measurement, recognition or presentation of any items in the Company financial statements.
ii. Ind AS 12 - Income Taxes: The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind AS 12. At the date of transition to Ind ASs, a first-time adopter shall recognise a deferred tax asset to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. Similarly, a deferred tax liability for all deductible and taxable temporary differences associated with: a) right-of-use assets and lease liabilities, b) decommissioning, restoration and similar liabilities and the corresponding amounts recognised as part of the cost of the related asset. Therefore, if a Groupe has not yet recognised deferred tax on right-of-use assets and lease liabilities or has recognised deferred tax on net basis, the same need to recognise on gross basis based on the carrying amount of right-of-use assets and lease liabilities.
The amendments had no impact on the Standalone financial statements.
iii. Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors: The amendments clarify the distinction between changes in accounting estimates, changes in accounting policies and the correction of errors. It has also been clarified how entities use measurement techniques and inputs to develop accounting estimates.
The amendments had no impact on the Standalone financial statements.
2.24. Significant accounting judgements, estimates and assumptions:
The preparation of the Company financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Some of the significant accounting judgement and estimates are given below
i) Defined benefit plans (gratuity benefits)
The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. All assumptions are reviewed at each reporting date. The parameter most subject to change is
the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation.
Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries. The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes
ii) Fair value measurement of financial instruments
When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. Refer Note 37 for further disclosures.
iii) Leases - Estimating the incremental borrowing rate
The Company cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. The IBR therefore reflects what the Company 'would have to pay’, which requires estimation when no observable rates are available. The Company estimates the IBR using observable inputs (such as market interest rates) when available and is required to make certain entity-specific estimates (such as the credit rating).
iv) Property, plant and equipment
Property, plant and equipment represent a significant proportion of the asset base of the Company. The charge in respect of periodic depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful lives and residual values of the Company assets are determined by management at the time the asset is acquired and reviewed periodically, including at each financial year end. The lives are based on historical experience with similar assets.
17 Other Equity (contd)
A The description, nature, purpose and movement of each reserve under other equity are as follows:-
a) Securities Premium :
Securities premium represents the premium on issue of equity shares. The same can be utilised in accordance with the provisions of the Companies Act, 2013.
b) General Reserve:
General reserve is the retained earnings of the Company, which are kept aside out of the Company's profit to meet future obligations, if any.
c) Capital Reserve :
Capital Reserve includes amount received on allotment of convertible warrants was forfeited and transferred to Capital Reserve Account.
d) Tonnage Tax Reserve (Utilised):
This reserve is a statutory reserve which is created and will be utilized in accordance with the provisions of Section 115VT of Income tax Act 1961 to comply with the provisions of 'Tonnage Tax Scheme’ under Chapter XII-G.
e) Special Reserve: The Hon’ble Andhra Pradesh High Court, approved the Scheme of Arrangement for amalgamation. ("The Scheme”) vide its Order dated March 19, 2013 which interalia, permits creation of a capital reserve to be called Special Reserve to which shall be credited excess of value of assets over value of liabilities on amalgamation of the subsidiaries amounting to ' 55,554 Lakhs to be utilized by the Company to adjust therefrom any capital losses arising from transfer of assets and certain other losses, any balance remaining in the Special Reserve shall be available for adjustment against any future permanent diminution in the value of assets and exceptional items etc. as specified in the Scheme as the Board of directors may deem fit.
f) Retained Earnings: Retained earnings comprise of net accumulated profit/(loss) of the Company, after declaration of dividend.
g) Share based payment Reserve: The share based payment reserve is used to record the value of equity-settled share based payment transactions with employees. The amount recorded in this reserve is transferred to securities premium upon exercise of stock appreciation rights by employees. The amount outstanding in the "Share based payment reserve" will be transferred to "General Reserve", when the options are lapsed / cancelled.
34. (A) Contingent liabilities and commitments
Contingent liabilities
In the ordinary course of business, the Company faces claims and assertions by various parties. The Company assesses such claims and assertions and monitors the legal environment on an on-going basis with the assistance of external legal counsel, wherever necessary. The Company records a liability for any claims where a potential loss is probable and capable of being estimated and discloses such matters in its financial statements, if material. For potential losses that are considered possible, but not probable, the Company provides disclosure in the financial statements but does not record a liability in its accounts unless the loss becomes probable. The following is a description of claims and assertions where a potential loss is possible, but not probable.
(2) Other Claims
The Company is involved in legal proceedings, both as plaintiff and as defendant. There are claims which the Company does not believe to be of a material nature, other than those described below:
B) Neera Children Trust ('NCT') Vs. Gati Limited. & 29 Ors. (NCLT 535 of 2019), NCLT Hyderabad
Neera Children Trust (NCT) has filed a case alleging oppression and mismanagement against Gati Limited, its promoters, and directors, with the case currently under the purview of the National Company Law Tribunal (NCLT) in Hyderabad. Various Interim Applications (IAs) have been submitted by different parties during the proceedings, addressing matters such as maintainability, waiver, the legality of postal ballots, shifting the registered office, and adding other respondents. In one significant development, Gati Limited filed an IA requesting the relocation of its registered office from Telangana to Maharashtra, which was granted by the NCLT on April 25, 2023.
As the litigation proceeds, Gati Limited's counter to the interim reliefs sought by NCT has been recorded, and the main petition is scheduled for a hearing on June 24, 2024. The case has seen six IAs filed by various parties, focusing on issues of maintainability, waiver, the legality of the postal ballot, the shifting of the head office, and the addition of other respondents. According to the assessment by the learned counsel, there is a high possibility of obtaining a favorable order in this case. However, the final resolution and its potential impact on Gati Limited's financial position depend on the NCLT's final verdict.
Until the NCLT reaches a decision, the ultimate impact on Gati Limited's financial standing cannot be determined with certainty. The Company is committed to monitoring the proceedings closely and will assess any potential financial implications as they arise.
34. (A) Contingent liabilities and commitments (contd)
Notes :
a) Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above as it is determinable only on receipt of judgments / decisions pending with various forums / authorities.
b) The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed as contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a material adverse effect on its financial position. Also, the Company does not expect any reimbursement in respect of the above contingent liabilities.
C) There has been a Supreme Court (SC) judgement dated February 28, 2019, relating to components of salary structure that needs to be taken into account while computing the contribution to provident fund under the EPF Act. There are interpretative aspects related to the Judgement including the effective date of application. From the previous year ended March 31, 2023, the Company is in compliance with same. The Company will continue to assess any further developments in this matter for the implications on financial statements, if any. Further, pending decision on the subject review petition and directions from the EPFO, the impact for the past period, if any, was not ascertainable and consequently no effect was given in the accounts.
D) The Code on Social Security 2020 (Code) related to employee benefits during employment and post-employment 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. However, the Company envisages that the impact of the above would not be material.
Defined benefits - Gratuity
The Company provides gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the company makes contributions to recognised funds in India.
These defined benefit plans expose the Company to actuarial risks, such as currency risk, interest risk and market (investment) risk.
The Company expects ' 20 lakhs to contribute to Gratuity Fund in the next year.
Defined benefits - Compensated absences
The Company provides for accumulation of leaves by certain categories of its employees. These employees can carry forward a portion of the unutilised leaves and utilise them in future periods or receive cash in lieu thereof as per the Company’s policy. The Company records a liability for such leaves in the period in which the employee renders the services that increases this entitlement. The total liability recorded by the Company towards this obligation is ' 14 lakhs and ' 14 lakhs as at March 31, 2024 and March 31, 2023, respectively.
Inherent risk
The plan is defined benefit in nature which is sponsored by the Company and hence it underwrites all the risk pertaining to the plan. In particular, this exposes the Company, to actuarial risk such as adverse salary growth, change in demographic experience, inadequate return on underlying plan assets. This may result in an increase in cost of providing these benefits to employees in future. Since the benefits are lump sum in nature, the plan is not subject to longevity risk.
C. Financial risk management
The Company has exposure to the following risks arising from financial instruments:
(i) Credit risk
(ii) Liquidity risk
(iii) Market risk
Risk management framework
The Company’s principal financial liabilities includes borrowings, Lease liabilities, trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include Loans, trade receivables, cash and cash equivalents and other financial assets that derive directly from its operations.
The Company’s activities expose it to credit risk, liquidity risk and market risk. The Company’s primary risk management focus is to minimise potential adverse effects of market risk on its financial performance. The Company's exposure to credit risk is influenced mainly by the individual characteristic of each customer and the concentration of risk from the top few customers. The Company’s risk management assessment and policies and processes are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same. Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and the Company’s activities.
(i) 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 and loans given. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to customers, including outstanding accounts receivables. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.
a) Trade receivables
As per simplified approach, the Company makes provision of expected credit losses on trade receivables using a provision matrix to mitigate the risk of default payments and makes appropriate provisions at each reporting date whenever is for longer period and involves higher risk. The Company uses expected credit loss model to assess the impairment loss or gain in accordance with Ind AS 109. The Company uses a provision matrix to compute the credit loss allowance for trade receivables.
(iii) Market Risk
Floating exchange rate
Floating exchange rate with reference to Market risk is the risk that changes in market prices - such as foreign exchange rates and interest rates - 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 optimising the return.
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The total unhedged foreign currency exposure at the year end towards Trade Receivable & Trade Payable is ' 9 Lakhs (Previous year ' 2 Lakhs) and ' 24 Lakhs (Previous Year ' 3 Lakhs) respectively. The Company does not have significant foreign currency exposure and hence, is not exposed to any significant foreign currency risk.
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. The Company exposure to the risk of changes in market interest rates relates primarily to the Company's long term and short term borrowing with floating interest rates. The Company constantly monitors the credit markets and rebalances its financing strategies to achieve an optimal maturity profile and financing cost.
The interest rate profile of the Company 's interest bearing financial instruments at the end of the reporting period are as follows:
38. Capital management
The Company’s policy is to maintain a stable and strong capital structure with a focus on total equity so as to maintain investors, creditors and market confidence and to sustain future development and growth of its business. In order to maintain the capital structure the Company monitors the return on capital, as well as the level of dividends to equity shareholders. The Company aims to manage its capital efficiently so as to safeguard its ability to continue as a going concern and to optimise returns to all its shareholders. For the purpose of the Company’s capital management, capital includes issued capital and all other equity reserves attributable to the equity holders and debt includes borrowings and lease liabilities.
39. Segment Information
A Basis for segmentation
An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components, and for which discrete financial information is available. All operating segments’ operating results are reviewed regularly by the Company’s Chief Operating Decision Maker (CODM) to make decisions about resources to be allocated to the segments and assess their performance.
The Company has two reportable segments, as described below, which is the Company’s primary business segment. These business units are managed separately because they require different marketing strategies. For these business the Company’s CODM (designation of the person who reviews) reviews internal management reports at quarterly basis.
Reportable segments - Operations
Express Distribution - Covers integrated E-commerce cargo logistics
Fuel Stations - Covers fuel stations dealing in petrol, diesel and lubricants, etc.
B Information about reportable segments
Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit (before tax), as included in the internal management reports that are reviewed by the Company's CODM. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm’s length basis.
42. During the current year, Company had signed an out of court settlement with AIR India, pertaining to an ongoing legal matter before the Hon'ble Delhi High Court. As a result, Company has received a sum of ' 42 lakhs towards the final settlement, which has been recognised as Other Income. Pursuant to the settlement, the Hon'ble Delhi High Court accepted the Company's petition for withdrawal of the case and released the original bank guarantee, amounting to '2,200 lakhs, which is equivalent to the disputed arbitral award. The mentioned bank guarantee has been released by the banking partner.
43. During the current year, Allcargo Logistics Limited ("Parent Company”) has acquired a 30% stake (1,50,000 Equity Shares) in "Gati Express & Supply Chain Private Limited" (formerly known as Gati Kintetsu Express Private Limited), a material subsidiary. The acquisition comprises 1,30,000 Equity Shares (26% stake) from KWE-Kintetsu World Express (S) Pte Ltd and 20,000 Equity Shares (4% stake) from KWE Kintetsu Express (India) Private Limited. The name of the Subsidiary Company " Gati Kintetsu Express Private Limited" has been changed to "Gati Express & Supply Chain Private Limited" w.e.f. July 27, 2023, duly approved by the Registrar of Companies, Mumbai, Ministry of Corporate Affairs.
44. During the current year, the name of Company has been changed to "Allcargo Gati Limited", pursuant to the approval of the Board of Directors vide their Meeting held on August 04, 2023 and the shareholders of the Company at the Annual General Meeting held on September 04, 2023. The Registrar of Companies, Telangana, approved and accordingly issued fresh certificate of incorporation pursuant to the change of the name w.e.f. October 19, 2023.
45. Disclosure pursuant to Securities Exchange Board of India (Listing Obligation and Disclosure Requirement and Regulation 2015) and Section 186 of The Companies Act, 2013.
(1) The Company had given interest free loan to a wholly owned subsidiary "Gati Logistics Parks Limited (GLPL)” amounting to ' 2,001 Lakhs towards financing a project in an earlier year, where the operation is yet to commence. During the earlier financial year, the Company has received repayment of loan amount to the tune of ' 558 lakhs and balance loan receivable amount of '1,443 lakhs had been provided as provision.
(2) Gati Limited has extended an inter-corporate deposits (ICDs) of ' 3,484 Lakhs to Gati Express and Supply Chain Private Limited (formerly known as Gati Kintetsu Express Private Limited) at an interest rate of 7.50% per annum, with interest payable at the end of the 12 months tenure.
46. The Board of directors in their meeting held on May 16, 2024 and May 19, 2023 has given the Company approval to explore the sale/disposal of fuel station business and an in-principle consent to transfer the fuel station business to one of its wholly owned subsidiary, Gati Projects Private Limited, respectively subject to consent from the respective Oil Marketing Companies and the necessary approvals from the shareholders of the Company.
47. There are no subsequent event after reporting date.
Notes :
1) The improvement in the current ratio is due to the relinquishment of the corporate guarantee related to the IDFC matter and the profitable disposal of non-core properties compared to their carrying value.
2) Strengthened debt equity ratio is on account of reduction in debt and inflow from share warrant conversion contribute to an improved financial leverage, reflected by a lower debt equity ratio.
3) The improvement in Return on Equity is due to increased earnings.
4) The company's vendor turnover ratio has been optimized due to decrease in the average accounts payables as compared to previous year.
5) The decline in net capital turnover ratio is majorly due to reduction in current liabilities on account of relinquishment of the corporate guarantee related to the IDFC matter and lower revenue from operations compared to previous year.
6) The improved net profit ratio is driven by better business performance and exceptional gains from the relinquishment of the corporate guarantee related to the IDFC matter, as well as the profitable disposal of non-core properties compared to their carrying value.
7) The improved return on capital employed ratio is attributable to favorable earnings results predominantly driven by exceptional gains, and reduction in debt due to repayment of borrowings.
48. Financial performance ratios (Continued)
Definitions:
(a) Earning for available for debt service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortisations Interest other adjustments like loss on sale of Fixed assets etc.
(b) Debt service = Interest & Lease Payments Principal Repayments
(c) Average inventory = (Opening inventory balance Closing inventory balance) / 2
(d) Net sales = Net sales consist of gross sales minus sales return
(e) Average trade receivables = (Opening trade receivables balance Closing trade receivables balance) / 2
(f) Net purchases = Net purchases consist of gross purchases minus purchase return
(f) Net credit purchases = Net credit purchases consist of gross credit purchases minus purchase return
(h) Working capital = Current assets - Current liabilities.
(i) Earning before interest and taxes = Profit before exceptional items and tax Finance costs
(j) Capital Employed = Total Equity Total Debt
(k) Return on Investment (MV(T1) - MV(T0) - Sum [C(t)])
(mv(t0) Sum [W(t) * C(t)]) where,
T1 = End of time period ,T0 = Beginning of time period, t =
Specific date falling between T1 and T0
MV(T1) = Market Value at T1, MV(T0) = Market Value at TO
C(t) = Cash inflow, cash outflow on specific date
W(t) = Weight of the net cash flow (i.e. either net inflow or
net outflow) on day 't’, calculated as [T1 - t] / T1
49. Other statutory information
(i) The Company does not have any transactions with companies struck off during current or previous financial year.
(ii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period during current or previous financial year.
(iii) The Company has not traded or invested in Crypto currency or Virtual Currency during current or previous financial year.
(iv) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority during current or previous financial year.
(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) during current or previous financial year with the understanding that the Intermediary shall:
(a) 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
(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries
(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) during current or previous financial year with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) 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
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(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries
(vii) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during current or previous financial 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.
50. Employee share-based payment:
The Company has formulated employee share-based payment schemes with objective to attract and retain talent and align the interest of employees with the Company as well as to motivate them to contribute to its growth and profitability. The Company views employee stock options as instruments that would enable the employees to share the value they create for the Company in the years to come. For the year ended March 31, 2024 the Company recognised total expenses of ' 43 lakhs (March 31, 2023 - ' 88 lakhs) related to Share based Payment schemes. The Nomination and Remuneration Committee of the Board of Directors of the Company during the FY 2023-24 have granted 9,50,000 ESARs to the Employees of its Holding Company and Subsidiary Company. The necessary accounting for the above has been made in the books of accounts in the respective years. Furthermore, the Nomination and Remuneration Committee of the Board of Directors of the Company vide its meeting held on March 07, 2024 have granted 5,25,000 ESARs to the Employees Subsidiary Company w.e.f April 01, 2024. At present, following employee share-based payment scheme is in operation, details of which are given below: ”
52. There are no standards that are notified and not yet effective as on the date.
53. The Board of Directors in their meeting held on December 21, 2023 has considered and approved the Scheme of Arrangement involving Allcargo Logistics Limited (Parent Company), Allcargo ECU Limited( Fellow Subsidiary), Allcargo Gati Limited (the Company), Gati Express & Supply Chain Private Limited (Subsidiary) and Allcargo Supply Chain Private Limited (Fellow Subsidiary). The Scheme involves merger of fellow subsidiary and subsidiary with the Company effective from appointed date of October 01, 2023 and the merger of the Company (post-merger of fellow subsidiary and subsidiary) with the Parent Company on the date the Scheme becomes effective. The Scheme has been filed with BSE and NSE and the Company is in the process of getting the necessary regulatory and other approvals. The Scheme of Arrangement and other relevant details are available on the Company’s website.
54. The Board of Directors in their meeting held on December 21, 2023 and Shareholders through postal ballot passed on February 05, 2024, approved to raise funds through various permissible modes, in accordance with applicable laws. The fund-raising will be conducted by issuing Equity Shares, equity-linked instruments, convertible preference shares, fully or partly convertible debentures, or through a composite issue of non-convertible debentures and warrants. Warrant holders will have the right to apply for equity shares or other eligible securities. The modes include private placement, qualified institutions placements, further public issues, preferential issues, rights issues, or any other permissible mode under applicable laws, or a combination thereof, up to ' 50,000 lakhs. The funds are intended for growth capital, expansion, capex, working capital, etc.
As per our report of even date attached For and on behalf of the Board of Directors of Allcargo Gati Limited
(formerly known as Gati Limited)
CIN: L63011MH1995PLC420155
For S.R. BATLIBOI & ASSOCIATES LLP Shashi Kiran Shetty Pirojshaw Sarkari
Chartered Accountants Chairman & Managing Director Director
ICAI Firm Registration No: 101049W/ DIN: 00012754 DIN: 00820860
E300004
Per Aniket A Sohani Anish T Mathew T S Maharani
Partner Chief Financial Officer Company Secretary
Membership no: 117142 M. No. 211965 M No. F8069
Place: Mumbai Place: Hyderabad Place: Hyderabad
Date: May 16, 2024 Date: May 16, 2024 Date: May 16, 2024
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